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The Taming of the Shrew: Investment Banking the Cryptocurrency

investmentWith prospector optimism up on the heels of events at BTC China and among the highest levels seen since before the April crash, the dramatic ending to both Silk Road and Atlantis is looking more and more like the best thing to happen to Bitcoin yet. Amid talk of the Feds’ seizure of the Dread Pirate Roberts’ assests, rumors of buried treasure hidden within blockchain pointing to some enormous stash of Bitcoins have conspired with everything else to make the cryptocommunity at large brimming with excitement and optimism. This new-found projection of long-term stability for the Bitcoin is certain to start turning some heads in the financial sector and beyond.

Likely hamstrung in its ability to gain any leverage on the cryptocurrency situation, the Federal government is too busy wrestling with the sequester to make any major plays on the Bitcoin market. Were it in any position to, one would think that they already have a team of their best and brightest working on a mining and investment strategy to ensure them a foothold on what is looking to become an economic behemoth. But more important than any government involvement—and all the more likely to boot as the prospects of real and tangible profits begin to outweigh the risks involved—would be that of the investment banks and the financial sector.

With landmark court decisions passing this year marking Bitcoin as a Federally recognized currency, it might still take the first Fortune 500 Company that is based solely on cryptocurrency investments to  finally get all the major players involved. By then it will largely be too late, at least to ride on the Bitcoin wave, and so it will fall to the cryptocurrency investment community of today to be the builders of those institutions tomorrow. And already innovative groups are branching out into those categories.

In addition to offering remotely automated mining setups, CEX.IO also offers Futures Contracts for the Bitfury ASIC mining chips, making it the first commodity exchange on the cryptocurrency landscape.  Digital Currency Research’s Bitcoin Bull Bear and companies and collectives like CryptoRally are charting the waters of strategic investment in the crypto markets, navigating toward short term gains and often looked to as a bellwether in turbulent moments. But when will we see the first bona fide virtual cryptocurrency investment banks, market making on coins and commodities and trading on derivatives?

The cryptocurrency landscape of today is engaged in a kind of primeval Wild West, where fortunes can be lost and won and lost again at the whim of the market as smaller players get squeezed out and cash out. But with recent developments coming from the Chinese market signaling a long-term growth and stability, what initially appeared to be too volatile a market for financial institutions could instead turn out to be something of a backdoor for the economic crisis. Considering the relative infancy that the economy is still wading its way through, it is now becoming increasingly clear that it will be in everyone’s interest to get some skin in the game sooner rather than later.


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Posted in Bitcoin, Cryptocurrency, Information, Investments

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