Just got done watching CNBC's Fast Money, and one thing in particular stuck out...

in #cryptocurrency4 years ago (edited)

Well beyond the fact that they talk about bitcoin and cryptocurrency just about every episode now, aside from that, another thing really stuck out.

Today they had Mike Novogratz on the show, which if you aren't familiar he is a former hedge fund manager at Fortress Investment Group and worked at Goldman Sachs for some time before that.

He is currently a billionaire, infamous these days for being one of the bigger wall street bulls with a $40k price target on bitcoin by the end of 2018.

What's more, he is also launching his own crypto fund called Galaxy Investment Partners.

More about Galaxy Investment Partners...

Originally the fund was set to launch in early 2018 and was slated to be the largest crypto fund in the world with roughly $500 million under management.

Well, hearing from Mike today, they have decided they are going to launch by next week.

Yes, you read that right, a $500 million crypto fund is slated to launch as soon as next week!

Mike said he wished they were able to launch 3 months ago as it was much easier to find good prices to invest in things, but either way they will be coming online in a matter of days.

Go figure.

If you assume normal hedge fund leverage, there could be as much as $2.5 billion (5x $500 million) coming in to the crypto space over the coming weeks from this fund alone.

One more thing that really stuck out...

The other thing that really stuck out was that Mike said that the exchange Coinbase was literally "printing money" right now and that he wished they had bigger investments with them.

That is interesting to me because do you know who else is wishing the had a bigger stake in ol Coinbase right now?

Paypal!

Paypal partnered with Coinbase in a small way a few months back, when they had the chance to just buy the company outright. Oh I bet they are wishing they did now...

To recap:

Massive Crypto fund coming online next week.

If they employ normal hedge fund leverages, we could see up to $2.5 billion coming in from that fund alone.

Coinbase is literally printing money right now.

Paypal is a dud.

I think that about covers it. Stay informed my friends.

Image Sources:

https://www.coindesk.com/mike-novogratz-doubles-down-on-10000-bitcoin-prediction/

https://www.coinbase.com/dashboard

Follow me: @jrcornel

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This sort of gives hope to those thinking bitcoin bubble may pop

Yeah appreciate @journeyoflife

We have a long way to go before that happens.

If bitcoin was a stock, it'd have split 5 times and be worth a few hundred dollars per share, and people would be like, "oh, cool, that company must be doing well" and then invest in Monsanto at $118 per share.

But bitcoin can't split, so the price looks gargantuan. Doesn't change the underlying value, which IMO is either $0 or more than $40k. Time will tell.

Good point about the stock splits. Haven't considered that. Look at the share price of Berkshire Hathaway.

Mike made a killing with ethereum. I think he made like 250 million.

250, after taxes :-D He's already a billionaire so what is another quarter bil?

I quite like the way Mike Novogratz thinks

Yeah, let's hope Bitfinex isn't also printing money.

Novogratz is cool and all, but he sure loves to pump his investments. I love how he casually mentioned EOS during one of his interviews on CNBC.

Sneaky dude.

Yo ,
Thanks for the great content

Incredible stuff, I wonder how this could be used to manipulate the price, however....

yes, price manipulation could be a factor. I think that it may be an issue over the next few months, but when we get enough funds like this coming into the market, it'll eventually grow too big to be manipulated easily

It is a great time to be alive isn't it? I'm making more money while I sleep than I can make at my job in an entire month!

Very interesting, I will keep an eye on the company... thank U

If this came to reality will be like.. Ready, set, launch.... ehehe

Thanks for the heads up. Mike is smart to get ahead of the crowd and start ASAP.

Great update really you are a great content creator and good to see your post. Can i Resteem your post?

@hassanjony No need to ask, everybody is happier when you resteem their posts :)

formerly in finance...interesting to hear and unfortunately can't do any digging as i'm getting up for the friday grind...can you tell me what you mean by "normal headge fund leverages?"

2 and 20 is a term often thrown around a decade back but i've never heard the phrase "normal hedge fund leverages."

Is he started a futures fund? is that where youre getting the 5x margin from?

There aren't many ways to lever up on crypto atm besides going long and spreading out risk. futures is another way of course since just last week, and i haven't checked the volume but i seriously doubt there is enough interest willing to take the short side of 500MM, particularly in bitcoin.

ill try to get to watching the clip this weekend but if you could elaborate and clarify before then, that'd be awesome as well.

The institutional players are just getting started, sovereign entities like the UAE-Saudi proposal, and "easy to use" crypto technology still on the near horizon. It seems like a market cap similar to that of traditional gold is a good first target $10T.

Cryptocurrency isn't a bubble. I think our current bond fiat system is a bubble. I wouldnt be surprised if satoshi nakamoto isn't really a front for the nwo elitists who want a one world currency and govt. Almost every country is in debt to federal reserve scam types. Economic collapse is coming eventually. They want everyone chipped and to be able to trace everything you do. Idk maybe im paranoid lol

@jrvornel I think Coinbase are having a really hard time handling their traffic right now. Taking too long to respond to messages or verify accounts. Hope this ends soon. Bitstamp is facing kind of the same problems right now as well.

Yep, they are adding anywhere from 100k to 300k new accounts PER DAY right now. Most anyone have trouble handling that kind of growth. I think they will make the appropriate adjustments in the coming weeks. :)

@jrcornel Can't blame them! I'm just a little impatient!

As long as the cryptos keep pumping, the crowd keeps coming and Coinbase just can't keep up. They need the power of a decentralized system to cope :-)

@cryptojaxx They need Steem ;)

Hello and thanks @jrcornel. Could you write a follow-up educational post and give us some lessons on how that 2.5 billion might be deployed, since in my understanding (fallible no doubt) hedge fund strategies usually involved going in on two or more positions in such a way that there is one set of positions that are likely to lose while the other set is likely to gain; but the relative sizes of the two sides and timing are such that it is expected that at the end of the day there would be a net gain. (Of course, taking some short positions might be involved, as well as simultaneously taking positions in other markets.)

 So I am asking myself whether that all 2.5 billion is going to the long side, and if it's all going

to the long side how is a hedge going to be set up?

 I know that with your long experience you can help us with a “quick course”.

Thanks in advance.

Haha yes that would be enough info to fill a post indeed! I can't really say for sure how they might deploy it other than the snipits I have heard Mike say in the past. He said he plans on deploying all around the industry, more than just coins. Said he plans on investing in miners, exchanges, and also coins.

Then, like you said, will he take the short side to also hedge some of his bets? Probably.

That might be why he has waited until now to launch his fund. He needed futures and options up and running so he could hedge his long plays.

Most likely he picks a core group of coins, buys positions and then buys a couple longer term puts on them for much less money to protect against a sharp downturn. He could also sell some calls against that position to fund those puts. That would be my guess anyways.

Other than that, you'd have to ask him. :)

Very interesting, and thanks @jrcornel. I am just now hearing a chat between Tone Vays and Richard Heart where they get into the nitty-gritty of how short positions could be maintained.

The upshot seems to be that only the guys with enough underlying to hand over if their position blows up are reasonably protected from serious wipe-out when shorts go bad. The brokers are setting scary margins on short positions.

They seem to agree that some of the recent price run-up is from the Big Boys loading up on the protective collateral they want to have on hand when they go short.

You are making some interesting comments about puts. Is CBOE going to set up option trading?

Check out the Vays-Heart chat. One take-away for me is that most of the hedging will involve taking off-setting positions in related markets, rather than heavy-duty shorting of BTC.

Cheers!

BTW -- I am unable to stop marveling at these millionaires/billionaires in the game fighting hard as if the need to make money. Something has gone wrong with humanity, from where I sit.

I don't agree that Coinbase is "printing money". They are exchanging bitcoin for USD. They create neither of them. Where does the printing come in?

It's an expression used to signify how much money they are making right now because of the explosion of new users.

Have you seen their fees? Strangely they are also connected to gdax which has little to no fees. Amd transfer to and from gdax is free and instant.

which is now being proved, everyone now understands that the future is behind the criterion, now everyone is assessing their impact on us and our society, there is a colossal growth, which few people believed before ... I'm sure everyone who wisely invests their money in the future will get profit. Thanks to such news, more people will be included in the process ... thanks for the information

I wonder if my friend Jamie Dimon is still alive? He should be watching this stuff you know. Haha

Coinbase is literally exploding with orders these days, it crashed in several occasions this week.
Hope next year they will add some more good coins to the platform 😁

I love the recap, lol.

The more I learn about Mike, the more I respect the man. Excited to see how this new venture of His takes off. Come on, Steem!

I've got to think that the GDAX trading platform is paying handsomely for Coinbase.

Now this is awesome news for the crypto...
This same next week CME Futures is launching and now Galaxy Investment Partners...guys Hodl. ....Hodl...This is going to be a really merry Christmas..

Incredible
Very informative

Hellow mr @jrcornel,nice post.

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thanks for adding 8 more tabs to my reading list... but really, this post has some rich zig-zagging through a lotos developments and players 💰💁🏼‍♂️

Informative. Where can we buy the coins or when ? And where

Depends on what coins you want to buy. If you are wanting to buy btc, ltc, or eth with usd, coinbase is probably the easiest. If you already have some cryptocurrencies, bittrex is pretty good to start. Once you learn more you can go to different exchanges. Follow @marketingmonk he does a short daily show that will help you get the hang of things.

Hope that helps! Good luck.

Thx :) im not that big of a noob . I meant where to buy the tokens from the article .. when will they be listed and where .

Oh... right... haha.

I was about to stop checking coinmarketcap every ten minutes, but now you have told me this.

ohh thank you Men for información follow now

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