The growth of alternative asset management into Crypto

Alternative Assets are growing strong.  Perhaps it is part of the reason why Bitcoin was so popular with investors.  The amount of places you can get good returns on your money are dwindling.  They are there – it’s just that they are changing.  Traditional markets may return enough just to stay ahead of inflation – but they also bear the risk of losing.  So in the long run, traditional investing is a net loss in the opinion of many investors.

There has been hesitation among traditional asset managers to add Crypto to their portfolio.  However,there are a growing number of Crypto only asset managers that offer Crypto friendly features like pseudo-anonymity, like AMFEIX.   Some will argue about the differences between these managers & funds vs. the traditional asset classes, but it’s not about a compare and contrast.  It’s about evolution.  Capitalism at its core is about evolution.

Capitalism knows no boundaries, it knows no countries, no loyalty.  It only knows that it has to evolve in order to survive.  Crypto is an interesting question because of the regulation involved.  Basically, being pseudo-anonymous is not always a good thing.  Because Crypto is unregulated (or to say differently, is not controlled by a government regulator) it provides the possibility for fraud.  Just have a look at what President Trump has to say about Crypto:

This is actually a positive comment for Crypto, because there are a number of new stable coins that use the US Dollar as a management reserve.  Crypto has a bad reputation due to Bitcoin, but Crypto is much more than Bitcoin, as we have seen recently in the markets.

Managing money is not easy.  The Barclay Hedge Index is roughly flat or slightly negative in the past years.  There are many fallacies of alternative investments, as explained on Zero Hedge:

Just because something is ‘different’ doesn’t make it ‘better’ – just because something is not mainstream doesn’t make it ‘honest.’  We all here agree that mainstream investing sucks, but do we use the same rational methodology when evaluating alternatives?  Crypto has proven this is not the case.  Investors lost their minds and did all the things they have been told not to do over the years.

Managers are exploring more markets – and one of those is Crypto.  While Crypto is not an asset class per se, it can be.  Crypto broadens the horizons of the manager, so that there are more markets to trade.  And Crypto sure is volatile!  That’s risky, but it’s also potentially profitable.

Also there’s a growing number of Crypto millionaires that simply feel more comfortable investing in the market where they made their money.

While the traditional fund management industry is dying – another one is being born.  Just like Bitcoin came out of no where, new fund managers and strategies are going to dominate the next decade.  Traditional funds like FX Concepts and others, have been closed. 

Global Intel Hub is going to keep an eye out on emerging managers in the Crypto space.

Crypto trading ecosystem expanding rapidly

Binance is the world leader in Crypto, founded in Asia by an Asian who goes by the name “CZ” – there is no dispute that Binance is #1.  As they expand they are looking to develop niche markets and partner with others who can help them achieve their goals.  Binance clearly is a leader, but they have spots where there is room for improvement, as we all know.  So here again Binance looks for partners who have already done it, and incorporates it into their system.  Most recently, Binance launched their own margin trading platform:

Top crypto exchange Binance has launched its margin trading platform, an official blog post published today, July 11, reveals.  Binance’s move to expand trading possibilities to meet the full scope of institutional and retail traders’ needs had already been indicated by exchange CEO Changpeng Zhao this May — the same month the exchange had suffered a major hack incurring $41 million in losses.

This is where the market is going, but there’s a lot more to trading than margin trading as we all know.  Trading requires a solid methodology, education and training, good execution; and security. 

Anyone who traded stocks during the 90’s or early 2000’s can attest to the fact that trading is easier when you are part of a group.  This is the idea basically of social trading – not necessarily you are following all the trades of your peers, but it gives you an idea of market direction and sentiment.  Also it can act as a confirmation of your own ideas.  Trading as part of a group or team has many added benefits, mostly psychological.  Trading is not a team sport, but working as a team always helps the individual.

So the question boils down to: what do we all want from trading?  We want a market that’s better, quick, and transparent – that’s what BQT is.  Traders have been waiting patiently for the Crypto ecosystem to evolve to the point where you can trade just like Forex or Stocks.

But BQT is more than an exchange, they also have peer to peer trading, social media for traders, education and more.  Their team has good bench strength, coming from leading firms that are already established. 

But what is perhaps most unique about BQT is their ability to trade the BNB token.  The owner of Binance even gave a shout out to BQT saying thanks.

And they do a lot of other useful things such as escrow and even have their own wallet.

The future is uncertain for Crypto – but one thing is for sure.  Trading Crypto is going to be a lot more interesting with offerings like this coming down the pike.

We read about this two years ago in the book Splitting Bits – that Crypto markets would evolve to eventually look like FX.  Crypto is, after all, Over the Counter (OTC) just like many debt markets, Foreign Exchange (FX) and some stocks.  There isn’t a single exchange for Crypto so that makes each venue even more unique. 

Some traders fear OTC because it’s considered ‘dark markets’ so exchanges need to comfort traders as much as possible, especially considering the recent hack of the Canadian exchange QuadrigaCX.

Some of them, like BQT, are taking this a step further and offering up the kitchen sink to traders looking for more than just an execution venue. 

Crypto remains an interesting asset class, with a growing number of bells and whistles for day traders to capture.  As always, Global Intel Hub is going to be monitoring this trend.  Stay tuned.