BITCOIN INVESTMENT
Bitcoin had made a host of millionaires. It’s been a fantastic opportunities for people to invest in this type of crypto currency and now’s the time for you to think about investing in bitcoin too.
However, in present scenario bitcoin rates are plummeting but as predicted its line graph will significantly surge to its peak by the end of 2018 and may reach upto $65000.
These prediction were came into existence by world’s largest derivatives exchanges, Cboe and CME Group. Cboe is exaggerating to launch a bitcoin-based exchange-traded-fund (ETF) and the US Securities Exchange Commission will decide on the fate of this new product on August 10.
CME Group’s bitcoin futures volumes are usually less than Cboe’s trade volume but contracts sold on Globex have also mushroomed. Today CME has 2634 contracts sold for July and products for August and September are seeing a small increment of sales. With the steady trend of investors getting into bitcoin-based futures products, Cboe hopes these derivatives markets will pave the way towards a bitcoin ETF.
There are two things that make an asset a good investment. One is an expectation of capital appreciation. The other is an expected future cash flow.
Capital appreciation is a rise in the value of an asset based on a rise in market price. It occurs when the asset invested commands a higher price in the market than an investor originally paid for the asset. The capital appreciation portion of the investment includes all of the market value exceeding the original investment or cost basis.
Future cash flows are discounted at the discount rate; the higher the discount rate, the lower the present value of the future cash flows. Determining the appropriate discount rate is the key to properly valuing future cash flows, whether they are earnings or obligations. If you received $10,000 today, the present value would be $10,000 because present value is what your investment gives you if you were to spend it today. If you received $10,000 in a year, the present value of the amount would not be $10,000 because you do not have it in your hand now, in the present. To find the present value of the $10,000 you will receive in the future, you need to pretend that the $10,000 is the total future value of an amount that you invested today. In other words, to find the present value of the future $10,000, we need to find out how much we would have to invest today in order to receive that $10,000 in the future.
To calculate present value, or the amount that we would have to invest today, you must subtract the (hypothetical) accumulated interest from the $10,000. To achieve this, we can discount the future payment amount ($10,000) by the interest rate for the period. In essence, all you are doing is rearranging the future value equation above so that you may solve for P.
These are pretty straightforward concepts. That’s why they are the foundation of sound portfolio management. If an asset can provide future profits or future income, then it is rightly a worthwhile investment.
Bitcoin does neither of these. Having one Bitcoin today does not entitle you to more Bitcoins in the future, nor does it offer the promise of any future cash flow. So and this is not a popular viewpoint these days - the cryptocurrency fails the test of what makes a great investment. It also fails the test of what defines a currency.
To exemplify, if a person is keeping a some bitcoins for trading with others than it may result into a major conundrum for that particular individual as he bought some bitcoin for shopping a thing and its fluctuating rates may not allow the buyer to purchase those things that they want to buy like people usually buy form paper cash like from Dollars, Rupees, Yen and Euros. As because of there stagnant rates of these paper cash flow its mark will never get diminished by introduction of modern technology coins.
So here is what Creatapedia think about Bitcoin and its latest updates will be reached to the users from time to time.
:-) CREATAPEDIA :-)