Ask The Commish: Our Commissioner Bought Bitcoin with the Pool Money!
I just found out that our commissioner has taken our pool money and bought bitcoin with it. I’m against it, and so are others in the league, not everyone but most of us. He told us that he’s already made money and told us to relax. There’s really nothing we can do if he doesn’t want to do it, so what do we do? Can’t he lose all our money?
Wow. First of all, I think if a commissioner is going to take the pool money and invest it, then the league should know exactly what the commissioner intends to do with the money, before the investment is made.
That’s how I view what your commissioner did. He invested the money. I’m being really specific about this: if the pool money is going to be used in any other way, besides just sitting in a standard bank account, or in an online account like Venmo, then the league should be fully aware of the transactions taking place.
I don’t necessarily have a problem with pool money being invested. My main issue with what your commissioner did, is that no one knew about it. That’s a major lack of transparency. Not only should he have told the league, but everyone needed to be okay with it, or else he shouldn’t have done it. It’s not his personal money. Everyone has a stake in the pool money, literally.
Not everyone knows about investing, whether it’s with stocks, options, or in this case, in cryptocurrency. If he presented to the league that he wanted to invest in bitcoin this year, and everyone understood what the risk was, and was in favor it? Cool.
I’ve heard of some commissioners taking league dues and using it to buy a certificate of deposit (CD), for example. Many years ago, CDs were great for (stable) short-term investments, but the current rate of return on CDs are horrible. If, for instance, your commissioner had plunked the money into a 5-month CD, the league wouldn’t lose any pool money with this type of investment, but it definitely wouldn’t make a lot of money either. CDs are “boring.” You’re not going to make a lot of money, but you can go to sleep at night, knowing that your principal investment is safe.
Bitcoin is a different beast altogether. The price of bitcoin can fluctuate wildly. It can be quite volatile. Your commissioner said that (allegedly) he’s already made money. However, it’s not out of the question that by the time January comes around, the value of your league fantasy stash could be considerably less than what he started with. On the other hand, in the same time frame, the pool balance could be worth considerably more. Bitcoin offers the opportunity for a high rate of return, sometimes rather quickly, but at the same time, the risk of quickly losing a lot of the value of your initial investment, is just as high.
Similarly, I can make the same assessment about stocks. They can be volatile as well, depending on which companies we’re talking about. I personally don’t think he should be taking the pool money and buying either bitcoin or stocks.
If there is a league where everyone is comfortable with the pool money being invested, and everyone understands the inherent risks involved, then by all means, they should go for it. Specifically, in your situation, you and some of the others in your league aren’t right with what he did. That’s what matters.
Did he indicate what he was planning to do with the gains he made? Was he going to share them? Was he going to pay for a surprise party for the league? Or, was he going to keep the gains for himself? What was he planning to do if he lost money on the investment? Would he be able to personally cover any losses? The parameters of this scenario should’ve been established and acknowledged by all - and put in writing.
He should respect that some of you aren’t comfortable with your money being used in this fashion. It’s your money. You can react any way you see fit. He most certainly should offer a response a bit more respectful than simply telling you to relax. He shouldn't be so cavalier about putting league money at risk - which is exactly what he did. If he’s not willing to cash-out the entire pool investment, he should do it for anyone who makes the request, and plop that money back into the Venmo account. He owes you at least that much, especially since he wasn’t transparent, or upfront in his actions from the very beginning. That wasn’t right.
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