CRYPTO TREND’s first issue featured Crypto Currency (CC) and addressed many questions about this emerging market. Every day there is new information in this market. These are just a few highlights to give you an idea of the exciting market.
The largest futures exchange in the world to create a futures agreement for Bitcoin
Terry Duffy, president and CEO of Chicago Mercantile Exchange (CME), stated that “I believe sometime in the second weeks in December you will see our [bitcoin Futures] contract out for listing. You can’t short bitcoin today, so there is only one possible way it could go. It can be bought or sold to another person. It’s much more efficient to create a two-sided marketplace.
CME plans to launch Bitcoin futures before the end of this year, subject to regulatory review. This will allow investors to trade Bitcoin futures, either “long” or “short”, if successful. Exchange-Traded Funds sellers have filed for bitcoin ETFs to track bitcoin futures.
These developments could allow users to invest in cryptocurrency without having to own CCs or use the services of a CC Exchange. Bitcoin futures may make digital assets more useful, as they allow users and intermediaries to hedge foreign-exchange risk. Merchants that accept bitcoin payments, but are concerned about its volatility value, could be more open to accepting the cryptocurrency. Institutional investors can also trade regulated futures that aren’t plagued with money-laundering concerns.
CME’s decision also indicates that bitcoin is too big to ignore. In the past, the exchange had seemed to exclude crypto futures. Brokers and traders are focusing on bitcoin, despite the fact that they have been struggling in these volatile markets. Futures would make it almost impossible for other exchanges, such as CME, or any other trading platform, to catch up. Scale and liquidity are important in derivatives markets.
Duffy said in an interview with CNBC that “you can’t ignore that this is becoming increasingly of a story which won’t disappear.” He said that there are “mainstream” companies who want to access bitcoin and that clients have a “huge demand”. Duffy believes that institutional traders could help make bitcoin more volatile.
Japanese village uses cryptocurrency to raise capital for revitalization
Nishiawakura, a Japanese village, is exploring the possibility of an Initial Coin Offering (ICO), to raise capital for the revitalization of its municipal infrastructure. This is a novel approach. They may seek out private investment or ask the government for support. Many ICOs have experienced serious problems and investors are skeptical about any new token’s value. Bitcoin was certainly not a joke.
INITIAL OFFERING – ( ICO ).
The first issue of Crypto Trend did not include an ICO, so we will mention it here. An Initial Public Offering (IPO) is where a company offers a product or service and asks you to purchase shares. However, an ICO allows anyone to start a Blockchain project with the intent of creating a new token. ICOs are not regulated, and many have turned out to be complete scams. An ICO that is legitimate can raise a lot to fund a new Blockchain project or network. An ICO can generate a large token price at the beginning, but then it will fall back to reality shortly after. An ICO is easy to hold if one has a basic understanding of the technology and a few dollars. Today, we have around 800 tokens in use. These tokens all have a name. They are all cryptocurrencies. Except for some well-known tokens like Bitcoin, Ethereum and Litecoin they are referred to as alt-coins. Crypto Trend is not recommending that you participate in an ICO at this time, as the risks involved are very high.
We warned in Issue 1 that this market is a “wild west”. We recommend caution. While some investors and early adopters have made huge profits in this space, many others have lost a lot of their capital. The government is considering regulations as they seek to collect all transactions in order to tax them all. They are all in huge debt and have little cash.
The cryptocurrency market has so far avoided financial problems from governments and banks, as well as pitfalls. Blockchain technology could solve many more problems.
One of the best features of Bitcoin is that 21 million coins can be created at any given time. This ensures that it can never be counterfeited. The government can print as much money as they want and inflation its currency until it is gone.
Future articles will focus on specific recommendations. However, do not mistake that early investments in this sector should only be made for your most speculative capital and money you can afford to lose.
CRYPTO TREND is your guide when you’re ready to invest in this space.