Bitcoin Futures Not the Only New Way to Invest with Crypto
Don’t blink or you’ll miss it.
That’s how fast the cryptocurrency world is moving, as regulators try to get a handle on how to protect investors and investors try to get a handle on what’s real and what’s too good to be real.
While the industry was still debating whether bitcoin would become the new monetary standard or go the way of Betamax VHS, the upstart cryptocurrency was listed first on Cboe in November and then on world’s largest future exchange, the CME, in December.
Complicating matters for those still confused about bitcoin? Or giving them an opening to get in on the bitcoin action in a way that makes more sense?
Those who are trying to read the tea leaves of the fast-moving developments in bitcoin have had a tough task. That’s because industry itself has been scrambling, first to understand bitcoin and its place in the monetary system; and then to decide how to react as institutions to this disruptive force in the ecosphere.
“If watching this emerging market is giving you whiplash, you’re not alone,” says Finova Financial CEO Gregory Keough. “It’s exciting, but it also can leave a lot of investors feeling paralyzed by indecision due to the extreme volatility of bitcoin.”
Reversing his earlier sentiments, for example, Interactive Brokers Chairman Thomas Peterffy told CNBC that “bitcoin being listed on two reputable exchanges gives a great deal of reputation to the product itself and I think as a result it will become even more popular than it’s been before.”
In November, he had told CNBC that bitcoin launching futures could be “suicidal” and he even paid for a full-page ad in The Wall Street Journal, warning U.S. Commodity Futures Trading Commission Chairman J. Christopher Giancarlo against clearing bitcoin on the same exchange as other established financial products.
Following the CME announcement, however, Interactive Brokers took out another full-page ad—this time in Investor’s Business Daily, and this time it was introducing its own bitcoin futures business.
Likewise, after bitcoin was listed on Cboe, CME was pessimistic. CME President Bryan Durkin told Bloomberg in September that he didn’t “see us going forward with a futures contract in the very near future.” But by the end of October, CME had reversed itself, announcing its plans to buy bitcoin futures.
If, as Peterffy says, bitcoin futures boost bitcoin’s reputation, it may draw institutional investors.
Read more about ICOs and a new alternative here.
But for investors who are still shying away from bitcoin, futures or otherwise, new investment opportunities offer other avenues for jumping into the crypto space. One of those is Finova’s JOBS Crypto Offering (JCO). A new model for raising secure capital on the blockchain, the JCO was structured by Finova and Cooley LLC to comply with SEC regulations while creating a hybrid of Initial Coin Offerings (ICOs), crowdfunding, and an initial public offering of stock.
“Working with our attorneys and the crypto community, we designed the JCO with the small investor and the startup company in mind,” says Keough. “With ICO, small investors were locked out because of legitimate SEC concerns with bad actors who were taking advantage of uncharted territory to promote potentially fraudulent ICOs. We solved that issue by designing the JCO as the pathway to the world’s first equity-backed token.”
In a JCO, a company can issue tokens in exchange for cryptocurrency or other funds. Finova’s own token will carry the unique attribute of being linked to a share of equity in Finova and will provide for an ERC-20 Ethereum token standard that can be traded in cryptocurrency and is also backed by assets in a U.S. corporation. Upon issuance of token dividends, the token will have the ability to pay the dividend directly to the wallet registered to the individual.
To learn more about JCO, visit: http://jco.finovafinancial.com