In the first edition of CRYPTO TREND, we introduced cryptocurrency (CC) and answered several questions about this new market space. There is a lot of news in this market every day. The following are some highlights, so that we can glimpse how novel and exciting this market space is:
The world’s largest futures exchange creates futures contracts for Bitcoin
Terry Duffy, president of the Chicago Mercantile Exchange (CME), said: “I think sometime in the second week of December, you will see [bitcoin futures] Signed to go public. Today, you cannot short Bitcoin, so there is only one way. You can buy it or sell it to others. Therefore, you have created a two-way market, which I think is always more efficient. “
CME Group intends to launch Bitcoin futures before the end of this year, pending review by regulators. If successful, this will provide investors with a viable way to “long” or “short” on Bitcoin. Some sellers of exchange-traded funds have also submitted bitcoin ETFs that track bitcoin futures.
These development potentials enable people to invest in the cryptocurrency field without having direct equity in CC or using the services of CC exchanges. Bitcoin futures can make digital assets more useful by allowing users and intermediaries to hedge their foreign exchange risks. This may increase the adoption of merchants who wish to accept Bitcoin as payment but have unstable Bitcoin prices. Institutional investors are also accustomed to trading regulated futures, which are not troubled by money laundering.
CME Group’s actions also show that Bitcoin has become too big to be ignored, because the exchange seems to have excluded recent cryptocurrency futures. Bitcoin is almost everything that brokers and trading companies talk about, and they have suffered losses in a rising but unusually calm market. If the exchange’s futures take off, it is almost impossible for any other exchange like the Chicago Mercantile Exchange to catch up, because scale and liquidity are important in the derivatives market.
In an interview with CNBC, Duffy said: “You can’t ignore the fact that more and more stories will not disappear.” He said that there are “mainstream companies” who want to get bitcoin, and customers’ “huge Repressed demand”. Duffy also believes that bringing institutional traders into the market can reduce Bitcoin’s volatility.
Nihonmura uses cryptocurrency to raise funds to revitalize the municipality
Nishiawakura, Japan, is studying the idea of holding an initial coin offering (ICO) to raise funds for municipal revival. This is a very novel approach, and they may seek support from the national government or private investment. Several ICOs have serious problems, and many investors doubt that any new token will have value, especially if the ICO is really just another joke or scam. Bitcoin is certainly not a joke.
Initial Token Sale-(ICO)
We didn’t mention ICO in the first edition of “Crypto Trend”, so let’s mention it now. Unlike initial public offerings (IPOs) where a company owns an actual product or service for sale and wants you to buy shares of its company, anyone who wants to initiate a new blockchain project to create a new project can hold an ICO. New token on their chain. ICOs are not regulated, and several of them are completely scams. However, a legal ICO can raise a lot of money to fund new blockchain projects and networks. ICOs usually generate high token prices at the beginning, and then quickly return to reality. Because if you understand the technology and have a few dollars in money, ICOs are relatively easy to hold, so there are many, and we can use about 800 tokens today. All these tokens have a name, they are all cryptocurrencies, except for very well-known tokens (such as Bitcoin, Ethereum, and Litecoin), they are called alternative currencies. Currently, Crypto Trend does not recommend participating in ICO because the risk is very high.
As we said in issue 1, this market is now the “Wild West”, so we recommend that you proceed with caution. Some investors and early adopters have already made considerable profits in this market space. However, there are many people who have lost a lot or all. Governments are considering enacting regulations because they want to understand every transaction in order to tax all transactions. They are all burdened with heavy debts and are bound by cash.
So far, the cryptocurrency market has avoided many financial problems and traps of governments and regular banks, and blockchain technology has the potential to solve more problems.
One of the major features of Bitcoin is that the promoters have chosen a limited number of coins that can be generated-21 million, thus ensuring that this encrypted coin will never be exaggerated. Governments can print as much currency (legal currency) as needed and depreciate their currency to death.
Future articles will discuss specific recommendations, but don’t get me wrong, early investments in this industry will only be used for your most speculative funds, and you can afford to lose money.
When you are ready to invest in this market area, CRYPTO TREND will be your guide.