What are cryptocurrency exchanges doing in relation to the public market? Roger Bryan, Digital Currency Index founder and cryptocurrency investing expert, breaks down where cryptocurrency currently stands with NASDAQ, JP Morgan and why it’s important.
Learn more about the current and upcoming events that could potentially impact cryptocurrency investments, in addition to information on cryptocurrency trends, main takeaways, pricing and other updates on six different coins such as Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), Ethereum Classic (ETC) and more.
Cryptocurrency, NASDAQ, JP Morgan & More
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The latest issue of The Roger Report: Public Edition features news stories on NASDAQ approved cryptocurrency exchanges, JP Morgan’s insights to blockchain for 2019, highlights from the newly proposed Bitcoin ETF and more.
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Roger Bryan is the founder of Digital Currency Index, a cryptocurrency investing expert and leading advocate of blockchain technology.
Roger Bryan is not an employee of Equity Trust Company. Any opinions or ideas expressed by Mr. Bryan are not necessarily those of Equity Trust Company nor do they reflect their views or endorsement. These materials are for informational purposes only. Equity Trust Company, and its affiliates, representatives and officers do not provide legal or tax advice. Investing involves risk, including possible loss of principal.
Prior to making any investment decisions, please consult with the appropriate legal, tax, and/or investment professionals for advice. As a self-directed IRA custodian, Equity Trust Company will not provide investment advice or risk assessment of any investment. The digital currency market may experience a high degree of volatility and clients should consult with an investment professional before any investment is made.
The following is a transcript of the video:
Hey everyone, welcome to the Roger Report, public edition for February 2019. In this month's newsletter, you're going to see us diving deep into what the exchanges in the cryptocurrency space are doing in relation to the public markets. We're going to talk about JP Morgan's recent efforts. We're going to talk about partnerships. The Nasdaq is established with cryptocurrency projects, cryptocurrency exchanges, and what this means for the overall market.
I highly recommend that you subscribe to the newsletter by clicking the link below this video. If you're already a subscriber, check your email for your newsletter and take a deep dive in. In this video today, I really want to talk about some of the macro market things that are going on so we can get an understanding about the movement of the cryptocurrency markets moving forward this year. So there were some big things that happened in January. Now, they were big in that we've been expecting them to happen, but they were quiet in that they didn't really create much impact and it's probably because it's going to take some time for that impact to take place.
The first one was the T-Zero platform launching. This was an idea started in about 2014 by Patrick Prying of Overstock. It's been much anticipated as the primary driver of the STO (security token offering) that is a publicly traded companies listing on blockchain based exchanges. It's kind of been a lack luster test launch. Right now, it's only open to accredited investors. It's moving very slow. Registration's been a little slow. They've had some issues with support, and a lot of the initial investors in the project are still waiting for their tokens to be released.
Now, why am I talking about this? Well, it's the transformation of this market into more of the regulated side of the industry, i.e., a publicly traded, meaning registered with the SEC and all of the appropriate entities in order to trade an equity based asset. This is much anticipated, as one of those three things that we're looking for major forward market momentum. But it's happening really slow. The idea is that market will open up to the general public sometime between August and October later this year.
You're also still dealing with the liquidity issues that relate to if people invested in a project a year ago, when the asset they invested with, say a bitcoin that was at an all time high, the relative value of the asset that they bought at that time once it comes to market, although it may see a 50 percent decrease in value over the first day, it still could be two to three times higher value than the asset that was initially used. If Ethereum was a thousand dollars when you invested and now it's at 100, you've got that margin in between those two. If you're looking at an asset to asset valuation.
Now, if you're starting to look at it as a USD valuation, no matter what you look at, there's definitely a spread between profitability on those assets. Why is this important? Well, what were the big three that we're looking for forward momentum in the overall cryptocurrency markets? It was the maturity, or actually the initial launch of the securitized token market, it was the ETF and it was the futures contracts.
So we're looking right now that the ETF, there's new filings with the FCC over a couple of different ETFs. There were a lot of them on the docket that ended up pulling their applications in January because of the government shutdown and then refiling again.
The futures exchange is coming from back, which is owned by ICE, which owns the New York Stock Exchange, is again talking about a release in the first half of this year. It's kind of a who's going to come first, the ETF or the futures contracts? Now, there are some futures contracts up there, but we're talking about bitcoin settled futures contracts, not dollar denominated future contracts that are just using the peg to the price of bitcoin, but actually have no impact on the price of bitcoin. That is…buyers and sellers don't need to hold the changeable asset in order to participate in that.
Those are the big three that we're looking fo catalysts and forward momentum for this market. That catalyst, once it hits, is going to come quick. That's why we're always looking at if we were going to be playing in this market and we are specifically trying to play one of those three. Now the securitized tokens are in of themselves, their own assets and not necessarily a driver of the value of bitcoin, but both bitcoin ETFs and bitcoin future contracts will have forward momentum on the price of bitcoin. Why it's always the most highly recommended coin to have in your portfolio if you're going to participate in this industry at all.
That's a general consensus of all market professionals. Now we don't dive into recommendations for individual projects, but we always say you're going to be in crypto and you don't want to deal with any of the other associated risks or market issues that may arise, bitcoin is the easiest way to play the market.
Now that always gives me a lead into why we're doing this with Equity Trust. We are firm believers in the Equity Trust Digital Asset Platform and its ability to allow you to invest in cryptocurrencies through your self directed IRA funds. I would highly recommend that you download their PDF guide on cryptocurrency investing.
Now we've looked at some macroeconomics, we've looked at it as forward momentum pricing elements inside of the market. Let's talk a little bit about what's going on in the market other than that.
There's a little bit of downward momentum in pricing across the board towards the end of January and as February rolled around. We started to see a little bit of forward momentum in that pricing. Not a lot. Mostly in bitcoin saw a little bit of movement. We're still seeing Ethereum trying to find its footing and looking at some new reports that have come out on the securitized token side of the world and where Ethereum is placed will be relative to other tokens that are out there that can be used for the creation of these types of assets.
With the different chains, side forks that are available in order to create customization in Ethereum, it still looks to be a potential leader for the securitized token revolution that is just starting and is just upon us. Remember T-Zero said that they're going to test this methodology for about six to eight months to make sure that the platform works, that they've got all of the bugs figured out, and during that time they're going to list approximately 60 more publicly traded companies on their platform, so when this platform becomes available to the general public towards the end of 2019 that there will be 60 assets trading on it.
Why is this important? There's an often undiagnosed problem. This is my personal opinion in the public markets in the United States. Over the last 20 years, the number of companies that are trading publicly, on major exchanges such as the New York Stock Exchange and Nasdaq, has fallen by greater than 50 percent. Most professionals who are industry professionals would blame that on the increase in the regulatory bodies oversight of these types of projects listing.
Now they say it's in the best interest of investors to create that protective barrier to make it cost a million dollars or more just to get a filing to go public. Right now, a lot of these companies that are getting ready to go public on some of the major securitized token platforms, they're doing reg C, reg D, reg A raises. You can do that for like five, $10,000 and in some cases $25,000. So if you look at the normal path to an IPO, with just a million dollars in regulatory filings, let alone all of the consulting fees that you're going to have to pay to the major banks, all of the money that you're going to have to spend on your road show ... A properly done reg A can be done for $100,000, a reg C for $5,000, in between for a reg D - $12,000 to $25,000.
And that's using lawyers, that's not using cookie cutter, print off the internet paperwork, which no one would ever recommend. But it gives you a good idea of how viable the securitized token market could possibly be when it looks at the cost efficiencies to come to market while the SEC is finally releasing new documentation on their view of the ICO, which was the initial coin offering. So the initial offering was the major way that projects raised funds in the cryptocurrency and blockchain space circa 2017, and then kind of the collapse in 2018. It's led to a lot of regulatory investigations. It'd led to a lot of criminal charges and it's led to a maturation of the market into the STO, or the securitized token offering, which we believe is going to be laying its foundation in 2019 and give us a nice run in 2019-2020.
Make sure you download the newsletter. We've got a ton of great news articles about each and every coin that you can trade on the equity trust digital asset platform. Some big macro news. We covered two of those stories. There's at least six or seven more that you can guide into. Once you subscribe, you'll get a copy of this newsletter, absolutely for free each and every month going forward, helping you stay up to date with what's going on in the markets.