In the first edition of CRYPTO TREND, we introduced Crypto Currency (CC) and answered various questions about this new market space. There is a lot of NEWS on this market every day. Here are some highlights that give us an impression of how new and exciting this market space is:
& # 39; The world's largest futures exchange to make a futures contract for Bitcoin
Terry Duffy, president of the Chicago Mercantile Exchange (CME) said: "I think you will see our (bitcoin futures) contract for listing sometime in the second week of December. Today you can't make a bitcoin short, so there & # 39 "It can only be done in one way. You can buy or sell it to someone else. So you create a two-sided market, I think it is always much more efficient."
CME plans to launch Bitcoin futures by the end of the year pending regulatory revision. If this succeeds, it offers investors a viable way to go "long" or "short" on Bitcoin. Some sellers of Exchange-Traded Funds have also applied for bitcoin ETF & # 39; s that follow bitcoin futures.
These developments have the potential to enable people to invest in crypto-currency space without CC & # 39; own or use the services of a CC exchange. Bitcoin futures can make the digital asset more useful by allowing users and intermediaries to hedge their currency risks. That could increase the acceptance of cryptocurrency by traders who want to accept bitcoin payments but are wary of its volatile value. Institutional investors are also used to trading regulated futures that are not troubled by money laundering concerns.
CME's move also suggests that bitcoin has become too large to ignore, since the exchange seemed to rule out crypto-futures in the recent past. Bitcoin is just about everything that everyone is talking about at brokers and trading companies that have suffered from rising but unusually calm markets. If the futures were to start on a stock market, it would be almost impossible for another stock market, such as CME, to catch up, because scale and liquidity are important in derivatives markets.
"You can't ignore this becoming more and more a story that won't disappear," Duffy said in an interview with CNBC. There are "regular companies" that want access to bitcoin and there is "huge demand" from customers, he said. Duffy also thinks that bitcoin can become less volatile if institutional traders enter the market.
Japanese village to use crypto currency to raise capital for municipal revitalization
The Japanese village of Nishiawakura is investigating the idea of holding an Initial Coin Offers (ICO) to raise capital for municipal revitalization. This is a completely new approach and they can ask for support from the national government or look for private investments. Several ICO's have had serious problems and many investors are skeptical that each new token will have value, especially if the ICO turns out to be a different joke or scam. Bitcoin was certainly not a joke.
INITIAL COIN OFFER – (ICO)
We didn't mention ICO in the first edition of Crypto Trend, so let's mention it now. Unlike an IPO, where a company has an actual product or service for sale and wants you to buy shares in its business, an ICO can be held by anyone who wants to initiate a new Blockchain project with the intention of new token on their chain. ICO & # 39; s are unregulated and several have been total shams. However, a legitimate ICO can raise a lot of money to finance a new Blockchain project and network. It is typical for an ICO to generate a high token price at the start and then quickly return to reality. Because an ICO is relatively easy to hold if you know the technology and have a few dollars, there have been many and today we have around 800 tokens in play. All these tokens have a name, they are all crypto currencies, and apart from the very well-known tokens, such as Bitcoin, Ethereum and Litecoin, they are called alt coins. Crypto Trend does not recommend participating in an ICO at this time because the risks are extremely high.
As we said in number 1, this market is currently the & # 39; wild west & # 39; and we recommend caution. Some investors and early adopters have made big profits in this market space; however, there are many who have lost a lot, or all of them. Governments are considering regulations because they want to know of each transaction to tax them all. They all have huge debts and are tied for cash.
So far, the crypto-currency market has avoided many government and conventional banking problems and pitfalls, and Blockchain technology has the potential to solve many more problems.
A great feature of Bitcoin is that the drafters have chosen a finite number of coins that can ever be generated – 21 million – making sure that this crypto coin can never be inflated. Governments can print as much money (fiat currency) as they want and blow up their currency to death.
Future articles will delve into specific recommendations, but make no mistake, early investments in this sector are only for your most speculative capital, money that you can afford to lose.
CRYPTO TREND will be your guide if and when you are ready to invest in this market space.