6 ms·

Related to this, does anyone know of a way to bet against bitcoin (or cryptocurrencies in general), without buying cryptocurrencies themselves? There are lots

by eemax 9y ago

Related to this, does anyone know of a way to bet against bitcoin (or cryptocurrencies in general), without buying cryptocurrencies themselves? There are lots of more-or-less sketchy cryptocurrency exchanges which allow you to shortsell bitcoin, but these all require buying cryptocurrency in the first place as collateral. The upshot is that if you bet against bitcoin and win, you win a bunch of... bitcoin. Not so useful if you want to bet on a big collapse of crypto in general. Selling bitcoin futures seems like a way to bet against bitcoin in the long term, using actual USD, although I don't think that will ever be an option for smalltime investors / individuals.

incompatible 9y ago
Some forex brokers offer bitcoin CFDs, where you can take the short side.
ricardobeat 9y ago
eToro let’s you short BTC, Dash, Ethereum, LTC and XRP, though no leverage is available for those, and the spread can be a bit daunting. Disclaimer: I don’t usually trade crypto there, this is not investment advice. EDIT: apparently it’s not available in the US. If you sign up with my referral link we both get $20: http://etoro.tw/2BmqxQb http://etoro.tw/2BmqxQb
- eemax 9y ago
  I should clarify that I am in the U.S... seems like most of these sites are unavailable here.
  - ricardobeat 9y ago
    Oh, sorry. I believe one of the main exchanges (bitsane/bitfinex Maybe?) was going to make options and margin accounts available, don’t remember which one. There’s also cex.io, but it’s in the UK. I guess you’ll have to wait for JP Morgan’s fund to go live...
- DigitalJack 9y ago
  I’m sure you could get odds in Vegas, though probably not long terms.
deleted 9y ago
[deleted]
empath75 9y ago
Yeah if anyone knows how to short these futures for someone with a few grand in his pocket to throw away on a risky gamble, please let me know.
- nissimk 9y ago
  Interactive brokers accounts can trade cme futures. Whenever these come out it will be just what you're looking for. The margin requirements allow you to short with a lot of leverage too. Good luck.
garmaine 9y ago
Why would you do that?
- eemax 9y ago
  Because it seems like an obvious bubble, with little / no real value? Bitcoin was / is a pretty cool technological innovation. But the main use-case seems to be buying illegal things or laundering money, and vast majority of transactions are just speculators. Also, the fact that it is difficult to short is further evidence of a bubble.
  - wslh 9y ago
    And don't you think that buying illegal stuff is a very large market and enough to make some cryptocurrencies specially interesting?
    - eemax 9y ago
      No, not really. It makes it useful for criminals, and a small number of people who might have good reasons to buy things, but that doesn't mean it should have a market cap of billions. I'm not saying there are no good uses for bitcoin, of course. For example, if someone used bitcoin to import prescription drugs from Canada to the U.S, that's great. But it doesn't justify a $100B+ market cap, and as it stands, the hard part of doing that is importing the drugs, not exporting the money. Similarly, just because Tor is useful mostly to criminals and a few human-rights advocates or privacy enthusiasts, I don't expect the Tor Browser to ever gain a major market share.
      - wslh 9y ago
        You are confusing illegal stuff with being a criminal and also subestimating the market size of just the casino industry.
        mirimir 9y ago
        Yes, gambling is arguably much larger than drugs by mail.
acjohnson55 9y ago
Go long in real currency or physical commodities?
modeless 9y ago
I recently sold a bunch of Bitcoin, and I believe it will go down, but I would never, ever short it. When you are long you have limited downside because the price can never go below zero. When you are short your downside is unlimited because there is no limit to how high the price can go. Bitcoin could easily quadruple in a few months before any crash happens, and your short would probably just be liquidated at a total loss to you even if a crash comes later. As we all know, markets can remain irrational longer than you can remain solvent, and these markets are very irrational right now, as clearly demonstrated by the nonsensical valuation of recent scam Bitcoin forks "Bitcoin Gold" and "Bitcoin Diamond".
- charlesdm 9y ago
  What is a crash though? Even at current levels, if it quadrupled and then crashes down 50%, is that a crash? Depending on when you acquired your initial position, you might not care much. Apple added 250bn in market cap this year. The entire crypto space is about 250bn in market cap. That does put things into perspective. Given crypto is completely global, this space is still tiny. Visa has a $250bn market cap. My assumption is, if it does end up being a massive bubble and mania, it will run high (like the .com bubble -- into the many trillions) but there will a major correction at some point. But how likely is it that will be any time soon? And are todays prices still cheap then? I would wager digital gold is probably worth more than $150bn in total market cap, even after a major correction.
  - kgwgk 9y ago
    What would you rather own? All the shares of Visa Inc. or every cryptocurrency token in the world?
    - charlesdm 9y ago
      Not exactly the best comparison. Obviously you would pick the shares since they are less volatile -- if they could magically appear in your brokerage account. However, say I had a net worth of $50m, then I'm quite certain I would rather own $5m in Bitcoin or Ethereum today than own $5m in Visa shares.
Vadoff 9y ago
Kraken allows you to short-sell. You can use USD on the exchange, so you can immediately short-sell and convert to USD if you want. https://support.kraken.com/hc/en-us/articles/209238787-Margin-borrow-limits https://support.kraken.com/hc/en-us/articles/209238787-Margi...
coupdejarnac 9y ago
I'm exploring buying options with the publicly traded Bitcoin based funds. No way do I want to depend on one of the Bitcoin exchanges. Plus, if things really go south, I'm sure I'll still be able to get paid using the stuff on the nyse or nasdaq.
- tome 9y ago
  Which funds are you looking at? I haven't found any way to reliably trade Bitcoin options.

by eemax 9y ago

incompatible 9y ago

Some forex brokers offer bitcoin CFDs, where you can take the short side.

ricardobeat 9y ago

eToro let’s you short BTC, Dash, Ethereum, LTC and XRP, though no leverage is available for those, and the spread can be a bit daunting. Disclaimer: I don’t usually trade crypto there, this is not investment advice. EDIT: apparently it’s not available in the US. If you sign up with my referral link we both get $20: http://etoro.tw/2BmqxQb http://etoro.tw/2BmqxQb

eemax 9y ago
I should clarify that I am in the U.S... seems like most of these sites are unavailable here.
- ricardobeat 9y ago
  Oh, sorry. I believe one of the main exchanges (bitsane/bitfinex Maybe?) was going to make options and margin accounts available, don’t remember which one. There’s also cex.io, but it’s in the UK. I guess you’ll have to wait for JP Morgan’s fund to go live...
DigitalJack 9y ago
I’m sure you could get odds in Vegas, though probably not long terms.

deleted 9y ago

[deleted]

empath75 9y ago

Yeah if anyone knows how to short these futures for someone with a few grand in his pocket to throw away on a risky gamble, please let me know.

nissimk 9y ago
Interactive brokers accounts can trade cme futures. Whenever these come out it will be just what you're looking for. The margin requirements allow you to short with a lot of leverage too. Good luck.

garmaine 9y ago

Why would you do that?

eemax 9y ago
Because it seems like an obvious bubble, with little / no real value? Bitcoin was / is a pretty cool technological innovation. But the main use-case seems to be buying illegal things or laundering money, and vast majority of transactions are just speculators. Also, the fact that it is difficult to short is further evidence of a bubble.
- wslh 9y ago
  And don't you think that buying illegal stuff is a very large market and enough to make some cryptocurrencies specially interesting?
  - eemax 9y ago
    No, not really. It makes it useful for criminals, and a small number of people who might have good reasons to buy things, but that doesn't mean it should have a market cap of billions. I'm not saying there are no good uses for bitcoin, of course. For example, if someone used bitcoin to import prescription drugs from Canada to the U.S, that's great. But it doesn't justify a $100B+ market cap, and as it stands, the hard part of doing that is importing the drugs, not exporting the money. Similarly, just because Tor is useful mostly to criminals and a few human-rights advocates or privacy enthusiasts, I don't expect the Tor Browser to ever gain a major market share.
    - wslh 9y ago
      You are confusing illegal stuff with being a criminal and also subestimating the market size of just the casino industry.
      - mirimir 9y ago
        Yes, gambling is arguably much larger than drugs by mail.

acjohnson55 9y ago

Go long in real currency or physical commodities?

modeless 9y ago

I recently sold a bunch of Bitcoin, and I believe it will go down, but I would never, ever short it. When you are long you have limited downside because the price can never go below zero. When you are short your downside is unlimited because there is no limit to how high the price can go. Bitcoin could easily quadruple in a few months before any crash happens, and your short would probably just be liquidated at a total loss to you even if a crash comes later. As we all know, markets can remain irrational longer than you can remain solvent, and these markets are very irrational right now, as clearly demonstrated by the nonsensical valuation of recent scam Bitcoin forks "Bitcoin Gold" and "Bitcoin Diamond".

charlesdm 9y ago
What is a crash though? Even at current levels, if it quadrupled and then crashes down 50%, is that a crash? Depending on when you acquired your initial position, you might not care much. Apple added 250bn in market cap this year. The entire crypto space is about 250bn in market cap. That does put things into perspective. Given crypto is completely global, this space is still tiny. Visa has a $250bn market cap. My assumption is, if it does end up being a massive bubble and mania, it will run high (like the .com bubble -- into the many trillions) but there will a major correction at some point. But how likely is it that will be any time soon? And are todays prices still cheap then? I would wager digital gold is probably worth more than $150bn in total market cap, even after a major correction.
- kgwgk 9y ago
  What would you rather own? All the shares of Visa Inc. or every cryptocurrency token in the world?
  - charlesdm 9y ago
    Not exactly the best comparison. Obviously you would pick the shares since they are less volatile -- if they could magically appear in your brokerage account. However, say I had a net worth of $50m, then I'm quite certain I would rather own $5m in Bitcoin or Ethereum today than own $5m in Visa shares.

Vadoff 9y ago

Kraken allows you to short-sell. You can use USD on the exchange, so you can immediately short-sell and convert to USD if you want. https://support.kraken.com/hc/en-us/articles/209238787-Margin-borrow-limits https://support.kraken.com/hc/en-us/articles/209238787-Margi...

coupdejarnac 9y ago

I'm exploring buying options with the publicly traded Bitcoin based funds. No way do I want to depend on one of the Bitcoin exchanges. Plus, if things really go south, I'm sure I'll still be able to get paid using the stuff on the nyse or nasdaq.

tome 9y ago
Which funds are you looking at? I haven't found any way to reliably trade Bitcoin options.