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30
November2017
Swiss Internet bank knows how to get rid of the bitcoin volatility problem

Swiss Internet bank knows how to get rid of the bitcoin volatility problem

So far, the permanent feature of bitcoin or any digital currency is the rate instability. The price of a cryptocurrency can suddenly rise, and then drop down as fast. Volatility is one of the main things that scares off investors from bitcoin. However, a Swiss online bank Swissquote says that it can solve the problem of exchange rate instability, as reported by Coindesk.

The spectacular boom on the cryptocurrency market, especially bitcoin price growth, drew the attention of many exchanges, hedge funds and traders to this virtual financial asset. Many opportunities to invest in it appeared throughout the year. And in early November, CME Group, a major financial derivatives stock exchange, announced their intention to launch futures for bitcoin.

Amid these rather positive events in the cryptocurrency industry, investors are looking for ways to minimize the risks of their investments in the cryptocurrency.

Head of marketing at Swissquote emphasizes that volatility is the only thing that stops investors. Therefore, the bank decided to develop a profitable trading algorithm, which will reduce the possibility of a sharp decline in BTC rate.

The bank experts suggest developing a portfolio of investments based on bitcoin and the US dollar. Thus, the funds could be stored in both cryptocurrency and traditional money. Special system algorithms will react to changes in bitcoin rate on time and automatically convert them to dollars, or vice versa. Specialists at the bank emphasize that this mechanism will help reduce risks for investors willing to invest in cryptocurrency.

 

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