What: Made a prediction that Bitcoin can hit $7,941.
When: Sunday 11/5/17
Why: Bitcoin has been gaining tons of public attention over the last couple years as the prices continue to skyrocket. Last week news came out that the Chicago Mercantile Exchange (CME) will include futures by the end of the year on bitcoin. A future is a legally binding contract to buy or sell a commodity or financial instrument.
The fact that large financial institutions are acknowledging the digital currency shows that regardless of everyone’s opinion there is money to be made in the digital currency era. Goldman Sachs is known for finding money making opportunities and I am interested to see if they somehow get involved with the digital currency. It has been reported that they are exploring trading operations for the currency. My prediction is that those facilitating trading as the brokers will be the biggest beneficiaries. Most importantly they will keep their profits no matter where the price moves of the underlying coin.
Additionally, the move by the CME adds a level of credibility causing an increase in price last week. I personally will not be investing in Bitcoin. I think the early adopters are being minted millionaires and are “playing with the houses money” at this point. The volatility of Bitcoin is unpredictable which is why I think it is a big win for traders to be offered futures contracts for the maintenance margin feature requiring the losing side of the bet to add additional funds to maintain their position from movements in the market. However, I think that anyone who is in this market is purely speculating and I would not advise anyone to use more than they are willing to lose when “investing”.
What Are Your Thoughts?
- Do you own Bitcoin?
- Would you add Bitcoin to your portfolio?
- How well do you understand block chain and the mechanics behind Bitcoin?