How can you make money in this environment? When you step back and look at trading on a quarterly basis, how has one faired in 1Q19? From January 1st to present, BTC has been stuck in a range of $3,350 — $4,200. Yes, you could have day traded masterly and had a good quarter for top line profits, but as many of you know, fees can add up with an active trading strategy. If you’re more of a strategic/opportunistic trader looking for 10–15% moves over a weekly time horizon, you really only had 2 good chances to capture these gains throughout these last two and half months. And to that point, with how thinly traded the BTC market is right now, you can see these moves happen in minutes and you MUST be on top of position 24/7 (once again, not easy).
So this brings us back to the initial question of the day; How can we make money in this market? In situations like these, it takes some creativity and courage to think outside the box and come up with new trading strategies or trade in areas that are not yet overtraded. This is the typical evolution of markets. Traders go to where money is most easily made, like water flows to the path of least resistance. As a strategy gets oversaturated (no pun intended) with traders using the same strategies, ‘edge’ diminishes. Therefore, these traders must find new strategies or products that give them their ‘edge’ back.
BitOoda’s thesis is that the Derivatives Market will see the next wave of influx of traders into the space, trading products with leverage that they could not normally get in the spot market. To date, we see the sophisticated funds within the digital asset space entering this derivatives markets. Because of this evolution of the market, typical ‘wall street’ funds are knocking on the door, looking to learn about the dynamics of these markets, waiting to pounce when the moment is ripe. Our goal here is to facilitate the trading of these products, in a transparent and compliant manner, without conflict of interest that we are seeing so much of within this industry. The momentum is building for the agency brokerage model. It is only a matter of time that the Digital Assets Market will catch up to other mature market classes within typical financial capital markets.