In the first issue of CRYPTO TREND, we introduced Crypto Currency (CC) and answered several questions about this new marketplace. There are many NEWS in this market every day. Here are some highlights that give us a glimpse of how new and exciting this market space is:
The world's largest futures exchange to create a Bitcoin futures contract
Terry Duffy, president of the Chicago Mercantile Exchange (CME) said "I think sometime in the second week of December you will see our (bitcoin futures) contract for listing. Today you cannot short bitcoin so there is only one way it can go. You either buy it or sell it to somebody else. So you create a two-sided market, I think it's always much more efficient. "
CME intends to launch Bitcoin futures by the end of the year pending regulatory review. If successful, this will give investors a viable way to go "long" or "short" on Bitcoin. Some stock exchange-traded funds have also applied for bitcoin ETFs that track bitcoin futures.
This development has the potential to allow people to invest in the cryptocurrency area without owning CC & # 39; s directly or using the services of a CC exchange. Bitcoin futures can make the digital asset more useful by letting users and intermediaries hedge their currency risks. It may increase cryptocurrency & # 39; s adoption by traders who want to accept bitcoin payments but are wary of its unstable value. Institutional investors are also used to trading regulated futures, which are not plagued by money laundering concerns.
CME & # 39; s move also suggests bitcoin has become too big to ignore as the stock exchange appeared to rule out crypto futures in the recent past. Bitcoin is just about anything anyone talks about at brokers and trading companies, which have suffered from rising but exceptionally quiet markets. If futures on a stock exchange started, it would be nearly impossible for any other stock exchange, such as CME, to catch up, as scale and liquidity are important in derivatives markets.
"You can't ignore the fact that this is becoming more and more of a story that won't disappear," Duffy said in an interview with CNBC. There are "mainstream businesses" that want access to bitcoin and there is "huge accumulated demand" from clients, he said. Duffy also believes it would make bitcoin less unstable to bring institutional traders to market.
Japanese village to use cryptocurrency to raise capital for municipal revitalization
The Japanese village of Nishiawakura is exploring the idea of holding an initial coin offering (ICO) to raise capital for communal revival. This is a very new approach and they may ask for support from the national government or seek private investment. Several ICOs have had serious problems, and many investors are skeptical that any new token will have value, especially if the ICO turns out to be another joke or scam. Bitcoin was certainly no joke.
ORIGINAL MINING OFFER – (ICO)
We did not mention the ICO in the first edition of Crypto Trend, so let's mention it now. Unlike an Initial Public Offering (IPO), where a company has an actual product or service for sale and wants you to buy shares in their business, an ICO can be held by anyone looking to launch a new Blockchain project aimed at creating a new symbol on their chain. ICOs are unregulated and several have been totally tight. However, a legitimate ICO can raise a lot of cash to fund a new Blockchain project and network. It is typical for an ICO to generate a high token price near the start and then sink back into reality soon after. Because an ICO is relatively easy to keep, if you know the technology and have a few dollars, there have been many, and today we have about 800 tokens in play. All of these tokens have a name, they are all cryptocurrency, and with the exception of the very well known tokens, such as Bitcoin, Ethereum and Litecoin, they are called alt-coins. At this time, Crypto Trend does not recommend joining an ICO as the risks are extremely high.
As we said in issue 1, this market is the "wild west" right now, and we recommend caution. Some investors and early adopters have made big profits in this market; however, many have lost a lot, or all. Governments are considering rules as they want to know about every transaction to tax them all. They all have huge debts and are tied to cash.
So far, the cryptocurrency market has avoided many government and conventional banking financial problems and pitfalls, and Blockchain technology has the potential to solve many more problems.
A good feature of Bitcoin is that the creators chose a limited number of coins that can ever be generated – 21 million – thus ensuring that this crypto coin can never be inflated. Governments can print as much money (fiat currency) as they want and blow their currency to death.
Future articles will delve into specific recommendations, but make no mistake. Early investment in this sector will only be to 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.