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What is a Bitcoin ETF?

There is a huge emphasis on Bitcoin ETFs in the investment community.

Jackson Zeng, COO, Caleb and Brown breaks down the jargons to give his take on this hot topic.

  1. What is a Bitcoin ETF?
  2. Why does it matter?
  3. How does this affect the market?

1. What is a Bitcoin ETF?
A Bitcoin Exchange Traded Fund (ETF) allows Bitcoin to be traded on the stock market. A trust would hold the asset on behalf of the fund while investors can trade its shares on the exchange.

2. Why does it matter?
Trading of Bitcoin currently involves digital asset custody. Investors and Institutions are concerned about handling that risk themselves. A Bitcoin ETF provides a new option for traders to get exposure to Bitcoin without having to worry about securing the digital asset themselves.

3. How does this affect the market?
Reducing the barriers to entry enables a new category of investors to join the market, which may spell greater liquidity and positive price movement as that money enters the space. It will also be a step forward in regulatory clarity on Bitcoin

Experts views from other sources:

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Jackson Zeng is the COO at Caleb and Brown is available to guide new and seasoned investors.

About Jackson Zeng:
Jackson has five years of trading experience in the cryptocurrency space and founded Bit By Bit Capital, one of Australia’s first private trusts investing in cryptocurrency.

Call Jackson on +61 1800 849 149  or Contact Us to discuss further.

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Know Your Tokens!

This article was first published by ICOscoring on Medium

Securities Exchange Commission (SEC) – USA and Financial Market Supervisory Authority (FINMA) – Switzerland broadly categorizes tokens as per below:

Security tokens — this type is to some extent similar to securities.
Utility tokens — this type gives its holders the access to services provided by the project.
Payment tokens — this type has its own Blockchain and is often considered as a mean of payment.

Know-your-tokens

Key features of each token

Security token (SEC) / Asset token (FINMA): This category of tokens represents assets such as participation in real physical underlyings, companies, or earnings streams, or an entitlement to dividends or interest payments. In terms of their economic function, the tokens are analogous to equities, bonds or derivatives.

Utility token (SEC) / Utility token (FINMA): This category provides access to the goods & services that the project will launch in the future. Also, they can be used as a type of discount or premium access to the goods & services of the project.

Cryptocurrencies (SEC)/Payment tokens (FINMA): Usually, the tokens of this category have no further functions or links to other development projects. Speaking broadly, cryptocurrencies purpose is to be items of inherent value (similar, for instance, to cash or gold) that are designed to enable purchases, sales, and other financial transactions, They are intended to provide many of the same functions as long-established currencies such as the U.S. dollar, euro or Japanese yen but do not have the backing of a government or other body.

Depending on the type of token, organizers and participants of an ICO might have different rights and responsibilities. It is worth noticing that the safest type of token for investors is ‘security token‘. However, this type of token makes ICO more complicated and requires KYC/AML procedures. For instance, FINMA considers these tokens as a type of security and applies the same rules to them as for other securities (stocks, bonds, etc).

Important points to note for investors:

  • It is necessary to analyze the type of token and the economy behind it when making investment decisions.
  • It is a must to always remember that the price of the token is based on the basic principles of economics, such as the law of demand and fair value.
  • It is always advisable to understand the base value of token and its current and potential price in case all the targets are reached.

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Jeff Zylstra, is the senior crypto broker at Caleb and Brown to guide new and seasoned investors.

Call Jeff on +61 413 342 200 or Contact Us to discuss further.

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How to Profit from a Bear Market?

At Caleb and Brown, we pride ourselves on keeping our clients updated about the market trends, including how to take advantage of the bear market like a pro!

Our Senior Crypto Broker, Jeff Zylstra has compiled a comprehensive market analysis report with a personal example. Jeff has over 5 years of experience as a broker and been trading cryptocurrency since 2014.

December 2017/January 2018 periods were, right at the ‘Point of Maximum Financial Risk

At the moment from my analysis, it appears we are around capitulation and despondency area, very close to the ‘Point of Maximum Financial Opportunity‘.

Positioning is the most important thing in this market, giving yourself the best possible chance to maximize the effectiveness of your capital by leveraging the market cycle is extremely important for a long-term investment strategy.

It is a Rinse and Repeat scenario, example;

  • When people are greedy, you are being fearful and selling into the euphoria.
  • When people are being fearful and selling out of panic, desperation and depression.

These are the optimal times to be a buyer!

Here is a look at a Bitcoin daily price chart from this year’s market cycle so far. How many similarities do you see comparing the market cycles?

BitcoinBitcoin-Price-Cycle

If you happened to have bought during peak thrill and euphoria I would stop worrying all the time, stop watching the price every day because guess what?

You are an investor, not a TRADER. Traders care about the day-to-day, week-to-week price fluctuations.

The nature of this very market is volatile, +5% -10% is just part of the everyday background noise.

Investors are playing the long game, and HOLDING has been proven by many traders to be a solid strategy.

You just got to have the strength to keep your emotions out of the game.

When I first bought Ethereum at $26 I felt the same feelings of anxiety and panic you felt when I saw the price move all the way down to $6.

I was questioning my investment, my strategy and the market. I felt really depressed at this stage.

I was very lucky that I drowned out the negative thoughts and emotions and held strong.
This market is an amazing tool for transferring wealth from the IMPATIENT to the PATIENT.

BE PATIENT!

Moral of the story is, Ethereum hit an all-time high of $1389.00 USD ($1891.26 AUD). I hit an average of 100x my original investment in this trade, looking back I don’t know what I was worried about.

There will be no reward without risk, no glory without suffering.

If you are looking for a position, a friendly chat or further information on market cycles reach out to me.

Jeff Zylstra is available as your broker to guide you through this jungle.

Call Jeff on +61 413 342 200 or Contact Us to discuss further.