HOME INVEST MARKETS BITCOIN FOR ALL – ARE CRYPTO FUNDS THE SOLUTION?
Interest in Bitcoin, crypto currencies and financial products that map or invest in them continues to grow. In many places, on the other hand, the voices after regulation and consumer protection regarding crypto currencies are becoming louder and louder. Regulated crypto funds can certainly also lower the entry hurdle for newcomers.
BTC-ECHO has already reported several times on regulated crypto funds. These include Blockwall, Postera and BITREAL.
Status quo of the Bitcoin formula
If you take a look behind the review of onlinebetrug, however, you will see that these Bitcoin formula funds are far from suitable for the masses:
Minimum investment unattainable for small investors
The Postera Fund – Crypto 1 has the lowest entry hurdle with a minimum investment of 50.000 Euro. At first glance, EUR 50,000 may not sound like a considerable sum. If, however, one considers the fact that an investment portfolio should always have sufficient risk diversification, then it is no longer a question of a small investment capital, which a potential investor should hold. Based on the minimum deposit, these regulated crypto funds are primarily aimed at institutional investors.
Low competition – high fees
The market is only responding to the demand for regulated crypto funds. As a result, there are still too few of them and there is no competition. As a result, there is little or no competition and the companies can afford high management fees and closing fees. A closer look at the Postera Fund – Crypto 1 reveals that an issue premium of three percent compared to equity funds does not attract too much attention. Even a management fee of 1.1 percent does not yet have a hard impact. What is more important, however, is a performance fee of 20 percent, which is deducted after a hurdle rate of 6 percent and a new all-time high (high water mark). Here, the company actually diverts one fifth of its profits.
Existing funds uninteresting for private Bitcoin trader investors
For cost reasons and due to high minimum Bitcoin trader investments, the existing crypto funds are still far from becoming interesting for a private investor: https://www.forexaktuell.com/en/bitcoin-trader-scam/. The Postera Fund – Crypto 1, as well as the other mentioned funds, are specifically designed as alternative investment funds (special funds) for institutional investors and are not distributed to private investors in the first place.
So let us come back to the detailed question of crypto funds, which are intended to protect consumers through existing regulation. In principle it is to be clarified here, how one can produce consumer protection at all.
Consumer protection – how is it really done?
Many regulations want to prevent consumers from losing money through speculative transactions. However, if you look at the big picture, you have to realize that returns are generated by assuming risk or volatility. Consumer protection does not mean protecting the investor from returns. In order to be able to earn a return on investment in the financial or crypto markets, one must practice assuming a certain risk. One can learn this only, while one acquires appropriate products and grows at it.
How can we protect the consumer? In my opinion, three essential steps are needed here:
The first step must be to provide clear and differentiated information and general economic education. Regulatory authorities should refrain from demonising the blockchain or crypto currencies as a whole or “warning” consumers against them and thus preventing them from dealing with them. Rather, they should make well-founded sources of knowledge available – this can also happen in the form of links to reputable and tested sources. Another possibility is to make knowledge available in a simple language, such as the Bundesbank does on various topics. This would also help to avoid or reduce information asymmetries that are already being complained about. This would make it easier to get to grips with a particular topic. Consumers can judge better whether they would like to carry the respective risk and invest money or not, after they have obtained an overview of the material.
Availability of entry-level products
Once a potential investor has decided on an investment, the second step should be to provide products that are suitable for beginners. These products must meet a number of conditions.
The Finnish telecommunications group Nokia is now also jumping on the blockchain train. They are currently looking for solutions to store data from the healthcare sector. In cooperation with the OP Financial Group, the Finns have launched a pilot project to store movement and health profiles securely, anonymously and decentrally.
Health data is a sensitive issue. While patient-related information circulates between doctors and health insurance companies, it is constantly exposed to a certain level of publicity. At the same time, however, they also contain patients’ personal information on the course and history of their illness. This (meta) data also includes data that can be captured via mobile devices. Fitness apps record how much we walk, sweat and sleep. This results in personality profiles that are on the one hand very useful when evaluated. On the other hand, however, they are personal and worth protecting.
Nokia wants to create trust with the Bitcoin news
Nokia is now developing a blockchain solution to explore this gap between the public and private Bitcoin news spheres as efficiently as possible. According to a review about Bitcoin news, they started their project together with the OP Financial Group. Currently, 100 participants are testing ways to best store and share health data while protecting privacy.
The technology allows the company, which is particularly well known for its mobile phones, to maintain an overview of the collected data. At the same time, the blockchain allows only verified parties to access the data. In their statement they state:
“Although the potential of interconnected health data is widely acknowledged, it is often not fully exploited. This happens precisely for reasons of authenticity, availability and privacy. Trust is an important requirement that health data can provide the greatest benefit to individuals, families and our global society”.
In order to create trust, blockchain technology is particularly useful in relation to data. First and foremost, with its decentralization, it offers protection against administration and possible misuse by corporations. The use of Smart Contracts can also help to protect the data. In the end, individual users can retain more control over their data than is the case with a centralized, institutional approach.
To this end, all data provided by the users of the Bitcoin news technology is encrypted
In the end, access only has a verified authority, in this case the Bitcoin news Financial Group. Nokia will then also verify the data. What they ultimately evaluate is only the relevant (meta) data, without any direct reference to the Bitcoin news.
Kristian Luoma, head of OP, is happy about this cooperation:
“We are very happy about the cooperation with Nokia. It’s great to see how the blockchain is applied in a field that needs trust […]. This pilot project is an example of the technologies we will use in the future in innovative collaboration to create value”.
In the test program, they use portable devices, among other things, to record the number of steps per day and the amount of sleep. This data is then stored on the blockchain. The developers then compare the results with the fitness goals of the users. The users who get closer to their goal and use the program will then receive digital loyalty points.
According to Nokia, the pilot project aims to provide insights and solutions to global health issues. A rapprochement between blockchain and healthcare already exists in the USA. There, however, the focus is more on the handling of patient files. The advantages of this technology have been recognized in the area of data backup in particular.
The developers of Ad-Blocking Browser Brave have received a $4.5 million investment. With this money, the creators want to further develop the browser and create a way in which users can pay voluntary micropayments to websites and at the same time surf advertising-free.
After the launch of the first Brave version at the beginning of the year, there was initially a big outcry from the big online media. They signed a “cease-fire & cease-fire letter” addressed to Brave. Among the signatories were some of the world’s largest publishers – they described the browser as “obviously illegal” and emphasized their losses by blocking advertising revenues.
San Francisco-based startup has now raised $7 million for a tight growth plan
Since then, the founders of Brave and the aforementioned publishers have been working closely on a joint solution. They want to find a solution that is satisfactory for both sides – for the users of the browser and for the media, which until now have been dependent on advertising revenues.
In an interview with CoinDesk, Brave CEO Brendan Eich said he wants to use the investment to double the number of employees from 10 to 20 in order to quickly fill the gap between publishers and Internet users.
Eich: “We want to create a win-win situation for Internet users and publishers. We put users first, but we also want to create better earning opportunities for publishers”.
The most recent investment round involved Founders Fund’s FF Angel, Propel Venture Partners, Pantera Capital, Foundation Capital and the Digital Currency Group.
Brave as a bearer of hope
Dan Morehead, CEO of Pantera Capital, invested $1 million in the company himself. He says Brave is the first browser with the potential to satisfy website operators and consumers alike.
Morehead also emphasized the history of the formerly dominant browser Netscape Internet Explorer. They were slowed down by new innovations and features, according to Morehead.
According to Morehead, the Brave business model and the innovation behind it protects the identity of the users and at the same time offers companies the opportunity to activate new sales channels.