Connect with us

Investment

Exchange Tokens: Neither a Great Investment Nor a Great Market Indicator – Coindesk

Published

 on


They’re definitely not equity, but could “exchange tokens” be bellwethers for one of crypto’s best use cases? (Spoiler: Probably not)

Among thousands of venture-backed startups, tokens, coins, blockchains and open-source technology projects, exchange operators now stand out among the top revenue getters in the crypto asset category. Coinbase, not the largest by trading volume even among exchanges whose trade data is trusted, reported $173 million in 2018 non-U.S. revenue, leading Reuters to estimate Coinbase’s global revenue as north of $500 million. 

If crypto has proven itself in one use case, it is as a volatile asset for investors hungry to speculate. Our estimate of exchange operators’ fee-based revenue shows this to be true. 

Genius Dog 336 x 280 - Animated

As such, crypto tokens issued by the exchanges themselves could be among the most useful digital assets in circulation. “Exchange tokens,” as they are called, offer holders discounts on trading fees and other benefits. This doesn’t make them anything like equity claims on exchange revenue, which several analysts have pointed out, no matter what buyback mechanisms are employed. It does make them much like the “utility tokens” issued in the initial coin offering boom of 2017 and 2018 – or like air miles – and some investors in these tokens embrace that narrative

Unlike air miles, exchange tokens trade freely on a variety of venues. As such it’s surprising that, despite the success of their issuers, the tokens themselves have not been more successful as investments. The table below shows the one-, three-, six-, nine- and 12-month returns of Binance’s BNB, Huobi’s HT, Bitfinex’s LEO and OKEx’s OKB, the four exchange tokens that make up the exchange token index provided by FTX, a derivatives exchange operator, as of Jan. 28 (data via Nomics).

The benefits to traders, however, can be significant. According to Binance’s fee schedule, the top tier of BNB token holders must today hold about $176,000 worth of the token and trade about $1.2 billion per month on the exchange (with BNB and BTC at current prices of about $16 and $8,000 respectively). For users trading in these volumes,top-tier BNB holdings provide fee discounts that would save them about $720,000 each month, off the standard trading fees – more, if these traders pay the fees themselves in the Binance token. They also provide access to “initial exchange offerings” (IEOs), a new asset issuance operated by the exchange. 

As such, BNB and other exchange tokens might be expected to serve as indicators as to the relative success of the issuing exchanges. After all, if an open market for air miles existed, you might expect one airline’s miles to trade at a premium to another’s, depending on flyers’ perceptions of their service. 

At one time, that was true of exchange tokens, but over the course of the past year it’s become less and less so. For most of these exchange tokens, the correlation between price and the issuing exchanges’ reported volume is weakening over time. (Unlike the exchanges in the revenue chart, not all these exchange token issuers’ reported volume is rated trustworthy.) 

Even as a more general metric, providing an indicator of the broad demand for crypto assets as a speculative investment, exchange tokens are a weak signal. Or, at least, they are no better than the price of bitcoin. At the same time as their prices have drifted from the reported volume of their parent exchanges, exchange tokens’ daily returns have hewed more closely to those of bitcoin itself.

It’s been 11 years since bitcoin was operational and you can make a case that speculation is the best-proven user narrative for the entire asset category. And it is a real use: not everyone in the world has access to volatile assets (and for some, perhaps no asset is volatile enough). For now, exchange tokens appear to be just another flavor of that volatility. Their price movements don’t yet support thinking of exchange tokens as a meaningful innovation in use or ownership. 

Disclosure Read More

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Let’s block ads! (Why?)



Source link

Continue Reading

Investment

Core Asset Wealth Management Launches Socially Responsible Investment Strategies – Yahoo Finance

Published

 on


Core Asset Wealth Management is a financial management company. Recently, the company has incorporated SRI and Gene Therapies into its services.

Seoul, South Korea–(Newsfile Corp. – December 3, 2022) – Core Asset Wealth Management approaches socially responsible investing (SRI) in the latest development and seeks to maximize investment returns while avoiding companies that harm the environment or society.

As socially responsible investing has evolved into Environmental, Social, and Governance support, Core Asset Wealth Management is facilitating its clients with sustainable investment strategies. As the name implies, it is an investment process that considers environmental, social, ethical, and governance issues before allocating funds. All investors want to see their portfolios grow, but not at the expense of ethical practices, society, or the environment. Popular sustainable industries have recently included solar, wind, waste management, and water filtration.

Genius Dog 336 x 280 - Animated

Core Asset Wealth Management investment planning is not just about finding ethical and socially responsible companies to invest in but also about taking an activist role by using their voting rights to affect change.

The company is focusing on Gene Therapy. It delivers an innovative yet controversial area enticing to invest in due to the possibility of curing previously incurable diseases. However, many ethical issues arise from the processes used, such as animal testing and the resulting changes that can occur in our DNA.

Core Asset Wealth Management uses many different socially responsible investment vehicles that can be used with Wealth Management. Stocks and bonds are always readily available, but applying the various SRI filters can be overwhelming and time-consuming. Socially responsible mutual funds and exchange-traded funds are more accessible ways to participate in SRI investment. For accredited investors, more customized SRI investments are available such as hedge funds, venture capital, and private equity funds.

Furthermore, Core Asset Wealth Management focuses on Ethical investing and shunning companies that test their products on animals, provide harmful effects, or regularly engage in fraudulent or deceptive practices.

By avoiding investments in these companies, Core Asset Wealth Management sends a message that they disagree with their unethical operations and support businesses that improve their lives and community. Ethical Investments provide the opportunity to apply their moral beliefs to the company’s Retirement Planning and other accounts. Core Asset Wealth Management Ethical Investments meet environmental, social, and ethical criteria to be included in various socially responsible investment (SRI) vehicles. These investments are divided into multiple categories based on their grade of green qualifications to help potential investors evaluate their options.

With new developments, Core Asset Wealth Management has come up with the following additional services:

Green Investments – Light

Light green investments are the lowest part of the ethical investment scale. This responsible investing filter avoids gambling, military, defense, nuclear energy, “sin” related companies, and weapons manufacturers.

Green Investments – Medium

Medium green investments are in the middle and apply a more rigorous filter that avoids oil and gas companies and alcohol and tobacco.

Green Investments – Dark

Dark green investments apply the strictest filters for investment ethics. They screen out companies that are active polluters, ignore social issues and focus on renewable energies like solar, recycling companies, and water purification investments.

About the Company – Core Asset Wealth Management

Core-Asset Wealth Management provides financial analysis and consulting to a broad range of retail clients and businesses. It also facilitates its client with Account Management, Market and Media Analysis.

Potential clients should visit the official https://acg-wealth.com/ for further updates.

MEDIA DETAILS:
COMPANY NAME: Core Asset Wealth Management
Client Name: Timothy Houston
Contact number: +822 3782 6980
E-mail: info@acg-wealth.com
Website: https://acg-wealth.com/

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/146692

Adblock test (Why?)



Source link

Continue Reading

Investment

Turkey’s CHP Vows $100 Billion of Direct Investment If Elected – BNN Bloomberg

Published

 on


(Bloomberg) — Kemal Kilicdaroglu , the leader of Turkey’s main opposition party, promised to bring $100 billion of direct investment if elected to power in the elections scheduled for June next year.

“There will be at least $100 billion of direct investment in the first three years of our government,” Kilicdaroglu said in Istanbul on Saturday, speaking at an event at which the CHP unveiled some of its economic, political and social policies.

He also said his government would secure an additional $75 billion investment in the first three years, from pension funds and wealth funds abroad, among other resources.

Genius Dog 336 x 280 - Animated

The event dubbed “The CHP’s Second Century Vision” included speeches from Kilicdaroglu’s top economic aides and prominent economists, including Massachusetts Institute of Technology professor Daron Acemoglu. 

Faik Oztrak, CHP spokesman and deputy chairman responsible for economic policies, said the party would appoint a central bank governor who is “respected by the whole world.” The governor’s aim would be to permanently bring down inflation to single digits, he said. 

Incumbent central bank governor Sahap Kavcioglu is frequently criticized by the opposition over his failure to rein in inflation. Annual consumer prices in October accelerated to over 85%, the highest in almost a quarter century. 

Under pressure from President Recep Tayyip Erdogan, who is fixated on economic growth ahead of elections, the bank has cut its interest rate for four straight meetings, lowering it to 9% last month.

Read more: Turkey Slashes Interest Rate in Line With Erdogan’s Demand

Erdogan is a self-proclaimed enemy of high borrowing costs and he has fired three predecessors of Kavcioglu for clashing with him on monetary policy. Acemoglu said inflation would be lowered only through “normalization” in monetary policy and by fixing policies on interest rates.

“Turkey’s company and bank balance sheets also need to improve. If companies and banks have negative balance sheets they can’t make new investments. And Turkey needs significant new investments,” he said. “This will again be fixed with the right monetary policy, right financial policy and resources.”

©2022 Bloomberg L.P.

Adblock test (Why?)



Source link

Continue Reading

Investment

Is Fomo the new greed when it comes to investing? – Financial Times

Published

 on


If investors insist on trying to time their moves in stock markets, said Warren Buffett almost 20 years ago, they should be fearful when others are greedy, and greedy only when others are fearful.

It is good contrarian stuff. And the time-honoured depiction of markets in the permanent push-pull grip of these two animal spirits has an enduring appeal because (nuance and caveats aside) it does actually explain a lot of market psychology quite neatly. The difficulty arises, as now, when greed and fear start defining themselves as the same thing.

In the parsing of the FTX collapse — and of a string of other recent debacles that seem ominously comparable as phenomena of the loose money era — fear of missing out (Fomo) has repeatedly emerged as the critical ingredient in the investment build-up before the fall. Fear, in this usage of the word and in the context of the FTX and wider crypto run-up, was creating something that looked an awful lot like irrational exuberance. This exuberance, in turn, was fuelling something that behaved from a market standpoint an awful lot like greed does during its periodic stints at the wheel.

Genius Dog 336 x 280 - Animated

As the Fomo narrative has it, investment money (much of it under the auspices of large, seemingly respectable funds) thunders collectively into particular assets (in many cases, with minimal due diligence) not because it necessarily believes in the underlying opportunity but because the rewards are presented as unmissable and the consequences of delay or scepticism are somehow scary.

The idea is not novel, even if the acronym is. Similar thought processes have featured before in earlier crises. In 2007, Citi’s Chuck Prince famously stressed the need to keep dancing as long as the music was playing: a freely chosen indulgence presented as an unquestionable obligation.

So is the current version of Fomo just greed in disguise? It is tempting to think so or, at the very least, conclude that the word “fear” here describes a more discretionary and easily surmountable dread than, say, the fear of loss, value destruction or worse. The casting of Fomo as a genuine fear demands evidence that there is some price to be paid for missing out (of the sort shops experience, for example, during panic-buying prompted by public alarm). Self-recrimination for a bonanza skipped, or the wrath of a dissatisfied investor, do not quite count.

During the past half decade of tech-centric investment, however, Masayoshi Son’s SoftBank has led the way in instilling a more legitimate set of Fomo concerns for certain investors. When the first of his Vision Funds launched in 2017, the $100bn vehicle was explicitly designed to create a new genre of tech investment.

It did this (or planned to) by using its scale not just to identify potential winners but to shower them with enough funding to ensure that, on metrics such as market share, they probably would be. This implied guarantee of dominance, however flawed, set a tone that would resonate: if investment is not about prospects but sure things, then Fomo is not greedy but wise.

With tech and crypto Fomo now in some limbo, a much larger and more complex version now sits on the horizon in China, and could dominate corporate and financial investment next year. A good number of fund managers say they are already positioning themselves for a short-term “Fomo event”. A relatively quick reopening of China or a sharp relaxation of zero-Covid rules is a change that no global or Asia-focused investor can afford to miss. The feeding frenzy could ramp up very swiftly.

But the longer-term Fomo trade relates to geopolitics, and to the way in which US and Chinese industrial policies have set themselves sufficiently at odds with one another to make some form of decoupling look more inevitable. Behind the rhetoric of the US Chips Act and the Made in China ambitions are geopolitical shifts that could eventually oblige more and more companies — in the US, Europe, Japan, South Korea and elsewhere — to make some kind of choice between the two blocs. In some cases, this might take the form of redesigned supply chains and other “friendshoring” investments to allow dual-track manufacturing and sales.

For others, though, there may be serious pressure to rethink being in China at all. And business leaders and their investors should perhaps consider that there may be valid reasons to miss out on the world’s greatest gross domestic product growth engine. This, truly, will put the “f” in Fomo: the question is whether the fear is strong enough for companies to push back before it happens.

leo.lewis@ft.com

Adblock test (Why?)



Source link

Continue Reading

Trending