China may soon launch the first blockchain ETF – Crypto Derivatives Trading
News from China, the shenzhen-based asset manager Penghua Fund has submitted the application to launch the first blockchain exchange-traded fund (ETF) in China, pending approval from the CSRC.
The blockchain ETF is used to measure the performance of a selected number of stocks whose business scope covered the area of blockchain technology in SZSE. The blockchain ETF was filed nearly at the same time the SZSE published its Blockchain 50 Index.
This action once again reveals the ambiguous attitude from the traditional finance entities towards blockchain and crypto. On the one hand, they admit and emphasize the great value that blockchain can bring towards finance industry. On the other hand, they are afraid of the crypto industry would break the rules and structures that have been built and used for years. Bitcoin and Ethereum ETF has be rejected by SEC mutiple times. Facebook’s trial of launching Libra has also received enormous resistance from the government. China has already started several rounds of clean out for crypto exchanges and miners. While at the same time, China announces its first crypto currency DCEP and now may launch the first blockchain ETF. These conflicting actions show people’s hesitation towards blockchain, but step by step, they are starting to accept it.
When crypto is becoming more and more mainstream, there is a growing requirements for the industry as a whole. One thing is a requirement for regulations and rules and the other is a requirement for a proper tool to realize risk management.
As for regulations and rules, it takes time. Over-strict rules and regulations would easily kill the beauty of blockchain with its transparency and decentralization while the mass and wildness of the past crypto market has proved the importance of proper regulations. It takes time for the mangement team to find the balance.
Therefore, instead of thinking too much of the uncertainty of the rules and regualations, a better strategy to get ready for the probable crypto explode is setting up a good risk management tool.
Derivatives products are invented to hedge the potential risk in both the traditional financial market and crypto market. By properly setting up leverage, investors can effectively make up the loss caused by the spot market. For example, your total investment is 1 BTC. You can still keep 90% of it in the spot market while investing 10% with short position in the derivatives market with a leverage of 10X. When the price of Bitcoin drops 10%, your total asset will still be 1 BTC. This is important when the market is extremely unstable.
When you are selecting among different platforms, the following aspects are the most to keep in mind:
- Security-is cold wallet used during all the process?
- Reliability-is the platform having any overloading issue?
- Transparency-any suspicious trading against its users?
- Customer Service– always instant and detailed response?
I recommend DueDEX to all crypto traders because it is an exchange with
- security –100% cold wallet usage during all deposit and withdraw process
- reliability-bank-level trading engine, over 100k TPS, no overloading
- transparency-never reported trading against its users
- customer services- Multi-language multi-channel and 24*7
They have also offered a testnet (testnet.duedex.com), so that you can start to learn and try derivatives trading yourself. When you are fully prepared to enter the field, you can register with my referral link, to get up to 70 USD entry bonus. http://bit.ly/DueDEXRef
Published at Mon, 06 Jan 2020 05:46:07 +0000
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