By
Godfrey Benjamin
December 6th, 2023
While the market continues to achieve new record highs, it’s becoming more and more challenging for ordinary, esp. novice investors to make a profit.
Crypto markets are surging, and there seems to be plenty of room for continued growth. In January 2017, cryptocurrencies had a total market cap of less than $20 billion. Today, that number exceeds $530 billion, and, at times, it has approached $1 trillion.
As one braggadocio cryptocurrency trading firm puts it: “counting its returns in tens of thousands of percentage points hardly hurt their popularity.”
This surging demand is pushing many financial institutions to offer their own crypto investment products. In October, Goldman Sachs announced it was investigating ways to integrate Bitcoin investment products into its offerings. In a statement to The Wall Street Journal, Goldman noted:
“In response to client interest in digital currencies, we are exploring how best to serve them in this space.”
If they decide to move forward, Goldman won’t be the first mainstream financial institution to offer a crypto investment product. In December CME Group and Cboe Group launched the first ever Bitcoin futures contracts on their exchange platform. These services in fact serve as addition to the already flourishing crypto-investment space.
In short, there are many opportunities for crypto investors to turn a profit. Just like cryptocurrencies are a diversified ecosystem, there is a diverse set of investment mediums that can help facilitate a successful entry into crypto investing. In general, many people are joining crypto exchanges, but there are others models available as well.
Crypto Exchanges
A cryptocurrency exchange connects buyers and sellers of cryptocurrencies. Most exchanges allow users to purchase various cryptocurrencies using fiat or other digital currencies. In many ways, a crypto exchange operates similarly to a stock exchange. Prices fluctuate based on demand, and digital currency holders can sell their stake for a profit.
Some of the most popular crypto exchanges are expanding in popularity with some adding as many as 100,000 new users each day. With the surging interest in cryptocurrencies, many exchanges are overwhelmed by the demand.
Several exchanges including Bitfinex, Binance, and CEX.io have been forced to temporarily halt new account registrations so that they could upgrade the infrastructure to accommodate the surging demand. In a stunning statement to The New York Times, Coinbase CEO Brian Armstrong said his service “can’t guarantee the website’s going to be up exactly when you need it.”
This can be problematic because crypto markets are prone to extreme shifts. These phenomena known as flash crashes can be shocking to the newly initiated. For example, just before Christmas, crypto markets endured a sudden crash that eradicated $200 billion in total market cap in under 24 hours. Then, within two weeks, the crypto market cap doubled from its low point after the fall.
Crypto exchanges represent an easy way for anyone to gain access to crypto markets, but they can be difficult to navigate without sufficient knowledge and experience.
Copy Trading Platforms
Since everyone can’t be an investment expert, many are turning to copy trading to navigate the markets successfully. Copy trading allows successful investment traders to sell their strategies, investment moves, or algorithmic trading models to interested novice investors. These platforms offer a proprietary trading model in exchange for a subscription fee or percentage of returns.
Meanwhile, other platforms offer a marketplace for buying and selling trading strategies and a community to facilitate a continuing crypto education. Signals and Enigma Catalyst, the two platforms that help meet the demand for crypto copy trading and growth-minded education, primarily fill this space.
Signals is a user-friendly, visually oriented platform that connects experiences traders with those looking for successful trading models and educational tools. It uses machine learning techniques to build quality research tools and provides a comprehensive visual component that helps new traders make the most effective investment decisions.
In contrast, Enigma Catalyst offers many of the same features, but it is more developer oriented and is less user-friendly. Focusing on the Python programming language, it’s ideal for more experienced investors or developers. Both Signals and Enigma Catalyst allow interested crypto investors to participate in this burgeoning marketplace. As markets continue to proliferate and mature, these services are increasingly helpful allowing novice investors behave like experienced investors.
Indeed, crypto markets can be daunting, but nobody has to get it through alone.