Bitcoin CFD's Being Limited Due to Constant Rise

in #bitcoin7 years ago

Bitcoin is being a difficult beast to tackle for derivatives brokers. The price of bitcoin has been gaining traction for two weeks in a row without a dip in site, and thats a losing proposition for CFD brokers. A CDF is a Contract For Difference which allows traders to speculate on the rising and falling prices of a financial instrument.
The only problem with bitcoin is its not falling like a normal stock or asset class. The brokers themselves are losing their shirts and are limiting their exposure to cryptos as a result. A one sided run on an asset class has been unforeseen and traders are being denied new accounts as a result.
The old adage that is popular with the crypto crowd "HODL" or "buy and hold" is causing this headache to the brokers since the usual dips aren't producing results that are typical with "normal" asset classes. The future is going to be an interesting one as we see crypto markets develop and institutional money mix in with the unwashed masses. New financial instruments will have to be invented that are actually advantageous to brokers.
As we see this "stampede" of big money come in at a clip of 50 billion a day lately, the world is going to wait in bated breath as crypto's change the way we think about money.

source: Victor Golvtchenko Brokers (Retail FX)
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