Crypto Currencies Pt. VI

Key Takeaways

• There are also scammers in the scene. You should be wary, for example, if the program code of the cryptocurrency is not open source code.
• Finally, there are first crypto funds: Exante, for example, is a regulated investment fund that invests in Bitcoins and is mainly aimed at institutional investors.

The Cryptocurrency Fund is another regulated fund that invests in five to ten of the most important cryptocurrencies; the target group is professional and semi-professional investors.

However, the application for a first Bitcoin ETF (exchange-traded fund/index fund) was rejected by the US securities regulator SEC in March 2017.

Attention scammers!

Digital currencies harbor dangers, because there are also fraudsters in the market. The best-known example: the providers of the cryptocurrency Onecoin. In April 2017, Onecoin was declared illegal by the German Federal Financial Supervisory Authority Bafin, and Onecoin employees were arrested in Italy, China and India.

Anyone investing in cryptocoins should be prepared for a wild roller coaster ride. Total loss is also possible, such as when a coin is hacked.

There are some criteria that should make you wary: You should be extremely cautious, for example, if the program code of the cryptocurrency is not open source code – with real cryptocoins, this is always publicly accessible.

You should also refrain if a single company controls the currency; genuine cryptocoins are characterized by a decentralized structure.

Last but not least, you should stay away if the blockchain is missing; real cryptocurrencies are always based on a blockchain that is publicly accessible.

There are also scammers in the token sector. Here, too, it is important to take a close look at the business model. In part, the cryptocurrency market also relies on the «pump-and-dump» model familiar from stock trading: prices of «real» cryptocurrencies that were previously bought cheaply are driven up by massive advertising – often with a reference to insider information about the future rise. In response, the scammers bail out again, causing the price to crash.

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M.Sc. Ehsan Allahyar Parsa is head of marketing at the Blockchain Founders Group — a venture capitalist & company builder backing Basenode.io. In 2020, he was ranked as one of. the “Top 100 Shapers” in the DACH region. Further, he speaks 10 languages and has traveled to 30+ countries, of which he has already worked in 9 spread over 3 continents. He has already been honored by the Chancellor for his social & political commitment at the tender age of 23. As a sought-after international speaker, the serial entrepreneur is renowned for his speeches on numerous stages like the German Shark Tank Primetime TV Show (DHDL) and the United Nations General Assembly in New York. Feel free to contact him via Mail , Instagram or LinkedIn.