New Fire Group Chief Economist Fu Peng's Speech — 2026 Is the First Year Crypto Joins the FICC Asset Allocation Framework

Source: 2026 Hong Kong Institutional Digital Wealth Management Summit Forum hosted by Xinhuo Group

Content compilation: Techub News

This is a full transcript of a speech by Xinhuo Group’s Chief Economist Fu Peng at the 2026 Hong Kong Institutional Digital Wealth Management Summit Forum hosted by Xinhuo Group. Fu Peng has 25 years of practical experience in traditional finance, with core expertise in macro hedge fund operations, and was a major beneficiary of the financial dividends of the previous era. In this speech, he steps beyond pure theory, using history as a starting point, combined with his own industry experience, to interpret why traditional finance is paying attention to crypto assets, the development stages and future trends of crypto assets, and to dissect the core logic of “FICC + C,” helping industry practitioners and interested parties clear the market fog and understand the underlying logic of the integration of crypto assets and traditional finance.

Core reasons why traditional finance focuses on crypto assets

In traditional finance, there is also close attention and tracking of the entire crypto asset market. Of course, today’s speech is quite simple—I’m just going to tell a story from history. For me, I am actually one of the main beneficiaries of the dividends of the previous era. Some might think my title is economist, but I am not a scholar. My core experience over the past 25 years, the real work I’ve done, is what is traditionally understood as macro hedge funds.

So everyone might wonder: why are these traditional capital and financial sectors starting to pay attention to crypto assets? Over the past year or so, I’ve been emphasizing: the future will definitely be FICC + C, meaning that asset allocation will include crypto assets as a key component. Many people want to know why, so I’ll take this opportunity to briefly share with you. As long as you understand this logic, you’ll already have the answer in your mind about how the market will move and how asset prices will evolve. Today, I’ll help you break through this barrier.

The birth of FICC and the reconstruction of finance through technology

We need to trace back to the origins of the FICC asset class, roughly in the late 1970s to early 1980s. Over the past decade or so, everyone here has clearly recognized that the overall framework and pattern of our world are undergoing huge changes. The most similar period after World War II was the 70s and 80s. As Xiao Feng just mentioned about artificial intelligence, and as many guests have also discussed AI integration, it is a significant technological advancement and productivity leap. Every wave of technological and productivity progress reshapes industries and sectors, including finance.

Finance is not static; it is definitely not like the scenes in movies such as “The Big Short” or “The Wolf of Wall Street”: traders shouting in the trading floor, wearing vests, as if at the NYSE, Chicago Mercantile Exchange, or London LME, still bearing the marks of traditional trading floors. That was the most traditional finance before the 60s and 70s: people quoting prices in vests, using typewriters and punch cards for transfers, trading, and payments. For Chinese-speaking audiences and most Chinese people, the impression of trading might still be in stock exchanges with flip boards and order forms, handed over to staff to call the exchange for execution. But finance and trading have moved beyond that era. The biggest change in finance has definitely been driven by technological progress.

The last technological cycle, represented by semiconductors, computers, personal computers, systems, and Windows, in the late 70s and early 80s, redefined the entire financial landscape. Today’s well-known FICC asset trading simply involves integrating interest rates, commodities, exchange rates, and stocks. The true birth of FICC was in the early 1980s.

By the 1970s, we already had derivatives pricing theories, such as options pricing and the Black-Scholes model, which most of you learned in school. But think about it: without the widespread adoption of computers, how could a derivative or asset quote or price be calculated in just a few minutes? It would be impossible to complete quoting, trading, and settlement. After 1985, until today, professional investors and institutions started using Bloomberg terminals. I began using systems like Reuters 3000, later Reuters XLR, ICON, around 1997-98 during the Asian financial crisis.

In other words, it was the advent of computers, semiconductors, information technology, and the data era that created the FICC system: with asset classes, inter-asset integration, cross-asset trading, hedge funds, algorithmic trading, and well-known funds like the Grandmaster Fund. Without this wave of productivity progress, finance would still be stuck in the era many laypeople think of as “traders being market makers, shouting orders on the trading floor.”

At that time, J.P. Morgan became the leading force in derivatives. The Cambridge-educated Blythe Masters, hired by J.P. Morgan, was one of the pioneers in establishing the FICC market, turning FICC into Wall Street’s most profitable core business. This was naturally linked to the global turbulence of the 70s and 80s. Remember: technological progress often coincides with world upheaval. Technological advances at certain stages tend to occur alongside shifts in global systems and order.

During the 70s and 80s, we experienced the Cold War, Middle East conflicts, dollar and oil crises, gold price surges, and the collapse of the Bretton Woods system. But human civilization always involves risk and opportunity. While the world order was chaotic, computer, semiconductor, and information technology industries were rising. I used to joke that in that era, there was a strange investment portfolio—betting on humanity’s future and betting on its demise, both of which could be profitable.

Similarities between today’s crypto assets and FICC in that era

Think back: since around 2019, have you been holding assets that simultaneously represent “the future of humanity” and “hedging against humanity’s end,” and kept holding them until now? Today, everyone recognizes that AI, data, and computing power will become the most important productivity drivers of the next era. The first half of the game is the traditional paradigm everyone is familiar with.

Why do I tell this history? Because nothing is static; everything is constantly being reconstructed and reborn through development. I once said that my entry into this space and the proposal of FICC + C might leave an important mark in history, just like J.P. Morgan and Blythe Masters laid the foundation for FICC. This could be a significant historical turning point: marking the end of the early 10-15 years of crypto development and the beginning of a new phase.

Between these two stages, investor structures, participants, market systems, and rules will undergo huge changes—indeed, they already are. As I mentioned in an interview earlier, many of the familiar ways of thinking and operating from the past 10-15 years may change dramatically. If you have enough experience in traditional finance, you already know what’s coming next.

Just like in China, where many local financial bureaus established exchanges and various financial assets, which, after continuous compliance, were gradually financialized and turned into derivatives, incorporated into financial institutions’ portfolios. The crypto market is undergoing a similar process. Today, people think commodity trading is routine, but before the 80s, commodity derivatives were very rare, and most people couldn’t trade assets like copper, aluminum, zinc, or crude oil. Now, trading exchange rates is easy, but it wasn’t back then; similarly, today, trading government bonds and interest rate futures is straightforward, but it wasn’t before. This feeling is similar to the domestic market in 2009, when stock index futures, options, and derivatives markets first emerged. If you feel this way, it means you understand: the logic is exactly the same.

The turning point in crypto asset development and personal observations

Back then, technological progress drove the transformation and integration of traditional finance into FICC; today, data, computing power, AI, and underlying encryption/blockchain technologies are once again reconstructing finance through technology. We’ve been observing, but honestly, in the early days, we wouldn’t participate at all. I joke that early on, it was about faith and fundamentalism—you had to believe in the narrative. But large-scale capital wouldn’t over-participate in such “faith-based trading” early on. Only when the market matures and certainty emerges will it be incorporated into asset management frameworks.

For example: would large financial institutions have included red beans or green beans in their asset allocations? Impossible. But today, copper can be made into futures, options, ETFs, and included in portfolios. The entire crypto ecosystem is undergoing a similar transformation. 2022 was the first time I engaged in deep discussions with some big figures in this space. The connection started from an interview I did in 2021, when Bitcoin was around $70k. A reporter asked my opinion. I was very direct: based on our traditional macro framework, we simply couldn’t understand their “faith narrative,” and we didn’t accept it. We would interpret the functions of value storage and others within our own framework, but I felt it wasn’t the right time to intervene; my understanding and models weren’t fully developed.

But I had a feeling: by then, the US CFTC had already classified Bitcoin as a commodity, a tradable financial asset. Based on this definition, I could understand its properties through traditional frameworks. I said at the time: I guessed that if liquidity tightened significantly in 2022, overvalued assets in traditional markets would undergo a large valuation correction; similarly, if my understanding of crypto assets was correct, they would also experience a liquidity-driven valuation decline. I guessed it could drop by half. Later, Bitcoin fell to over $20,000 by the end of 2022, and many in the community approached me, realizing that the times might be changing.

Over the past few years of exchanges, I’ve found that many true crypto industry leaders are very similar to those in traditional finance: early on, they were rough and bold, in a “bet everything on a motorcycle and turn it into a motorcycle” phase. But those who can reach the future will quickly absorb and transform during times of change; those clinging to old experiences are likely to be eliminated. My personal view: 2025 and 2026 will be the turning points for crypto assets.

The importance of FICC + C integration and compliance

When people come to exchange ideas, it’s essentially mutual learning: you share your narrative, I absorb, integrate, and reinterpret from a traditional finance perspective; I share my macro logic, and we combine and learn from each other. After several years of integration, a new system has formed. Including last year’s liquidity tightening and valuation compression, which played out again in the crypto market, indicating we are on the right path. This inclusiveness and integration will ultimately lead to no distinctions. Just like Wall Street traders who initially only traded stocks, and later institutions that traded FICC assets, eventually merging into one. The future will definitely be FICC + C, with no clear separation.

For us, another key point is compliance. 2025 will be a crucial year: whether it’s the stablecoin legislation or definitive laws related to digital and crypto assets, the major legal frameworks have already provided market answers. Next, you will see traditional Wall Street institutions entering rapidly. Crypto assets will become part of diversified reserves, integrated into portfolios, just like foreign exchange reserves. Moving from single reserve/trading assets to diversification: in the past, we added commodities, exchange rates, and interest rates; today, we add crypto assets.

But remember: when they truly integrate into the traditional financial system, it signals the arrival of a new era and the end of the old one. After the 80s, the proportion of retail investors in the US stock market continued to decline, while institutional participation increased. This is an inevitable path for markets to mature. Is the crypto market also following this path? The answer is yes.

The positioning of crypto assets and the trend of the times

Stablecoins will segment the payment functions of crypto/blockchain technology. So what exactly is Bitcoin? A reporter asked me: is it digital gold? I said that’s controversial because it depends on the definition. For professionals, it’s clear; but for ordinary investors, the first reaction is physical gold. The precise definition of gold should be: an asset that stores value and can be scaled for financial trading.

Some assets have value but may not have large-scale financialization or tradability. For example, limited-edition sneakers, collectibles, Richard Mille watches, walnut carvings, or noble orchids… they have emotional and collectible value but are hard to standardize and turn into tradable assets. Today, the standard definition of crypto assets is very clear: Western development paths are explicit: if it’s not prohibited, it’s allowed; innovation and exploration are encouraged. Just like derivatives in the early days—demand existed first, then business was developed, followed by regulation and layered standards, eventually leading to maturity. Financial innovation leads, regulation follows, and the process matures—crypto assets are following the same logic.

The key question now is: by 2025, will financial regulation certainty be established? My answer is: yes. The future landscape will be very clear: in terms of technology application and payments—stablecoins; for core assets like Bitcoin—defined as assets with value storage and tradability functions. This definition might upset some old-school fundamentalists, but it’s the trend of the times, and there’s no way around it.

Crypto assets are mature enough to be included in mainstream portfolios

With this logical cycle complete, Wall Street can fully engage. A new chapter is about to begin. I don’t know if today’s speech will be recorded in history, but I hope it will, and I also hope it sparks some reflection. It might also answer many people’s questions: why would an “old-school” FICC practitioner enter such a new industry? The answer is: because the era has matured to the point where crypto can be included in mainstream asset portfolios.

That’s all for my sharing. Thank you all.

Let’s give a warm round of applause to Vice President Fu Peng for his wonderful presentation. Please stay a moment. Now, together, we will witness a historic moment.