How Investment Funds work and how to use your cryptocurrency to invest in one of them


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Imagine this: You have some extra money, and even know that you need to invest it to counter inflation and even make some profit over time.

But the big question is: Where to invest?

There is always the bank saving accounts, but these usually have low profitability that sometimes don't even grow above the inflation.

When you start to look for better investments, you find out that there is a ton of assets that you can invest in: Stocks, Bonds, Currencies, Derivatives, Deposit Certificates, Bank Deposits and so on...

It is a lot, and each type of asset even have a lot of options to choose from. Suppose that you want to buy some Stocks at NASDAQ... Well, there is 3300 commpanies to choose. Good luck picking the right one...

Cryptocurrencies is what you are looking for then? There are 5000+ different criptocurrencies on the market.

A adding to the amount of options you have, and the time you need to learn about the asset, there is also the problem that the most profitable assets usually require a large sum of money to be able to make an initial investment.

This is where Investment funds enter the picture

What are Investment Funds

Let's say there is a group of 100 people with some money to invest, let's say in stocks for example, but none of them individually have the proper knowledge to choose the right investments, nor the pile of money needed to buy the most profitable assets.

But all of them know this one person (Let's call him Gary), that work on the financial market for more than 10 years and have a lot of experience in choosing profitable assets to invest.

Now, instead of the 100 people individually trying to find the best stock to buy, they give the control of the money to Gary, and he use this funds to pick the most profitable stocks in his experience.

In exchange for his services, Gary collect a fee from the investors, that could be based on the total amount of money invested, or a percentage of the profit achieved by his operations.

There you go. This is the basic drawing of an investment fund. I talked above about stocks wich is a high risk investment, but this can also be done using low-risk investments.

The problem

Can the 100 people trust Gary? How do you make sure that Gary will give the money back to the investors when they want it instead of flying to another country and disappearing?

Also, how can they know if Gary is actually a good financial operator, or just some guy good at marketing (he must be, to be able to convince 100 people to give him monet) but don't know shit about financial markets?

Or maybe Gary is trustful, his 10 years of experience is true, but he never operated with stocks.

A lof of people complain about Governments and how bad they are, but if there is one thing that most Governments are good and essential is regulating financial markets to make it almost impossible for financial scams to last long.

Banks and private funds must comply to these regulations, because without them, there is clear rules and the investors won't feel safe to put their money in the system.

Eventually, a guy like Jordan Belfort (The wolf of wall street. Watch the movie if you haven't yet) might appear, and use the system to scam inside the legal regulations. Fortunately, solid governments always act to avoid the same situation to happen again.

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NOT Jordan Belfort

Now if you want to invest with FIAT money there is no safer way (with clear risks). Don't be a fool and give your money to some random dude that promisses 5% of gains every day. If they are outside the regulatory system, there is 99% of chance that it is a SCAM.

Investments on the cryptocurrency sphere

As everyone already know, the cryptocurrencies in itself already are investment assets, since they are openly traded in a lot of different markets.

But the last years brought up some other possibilities of investing your cryptocurrencies, also known as DeFi (Decentralized Finances).

Here is a few assets you can invest that is related to cryptocurrencies:

  • You can lend a stable coins on Nexo platform
  • You can also hold NEXO tokens to recieve dividends from that platform
  • You can provide liquity on decentralized exchanges, like Bancor
  • You can lockup your criptocurrencies in exchange for stable coins like DAI
  • You can buy exchanges tokens like KuCoin or Bibox
  • You can lend cryptocurrencies as leverage to margin traders in exchanges like Binance
  • You can lock up STEEM as SP an recieve 15% of the reward pool distribution without doing anything else
  • And a lot of other ways.

But all the above possiblities are about directly investing in an asset. At the end of the day, for these investmentes to be actually profitable, you need market knowledge and that isn't something that can be acquired in a few google searches.

Enter Genesis Vision - Cryptocurrency funds investment platform

I discoreved this project a few months ago, and after toying around with it a bit, i have to say: i am pretty impressed with what i see.

Remeber the problems i mentioned when someone wanted to give the money to someone with more market knowledge to operate on the market for you?

Genesis Vision try to solve exactly these problems.

How it works

After you create an account, you can deposit funds on it using USDT, BTC, ETH or Genesis Vision native token GVT.

Then you will be able to see this list:

Captura de tela 20200207 15.22.05.png

These are all cryptocurrency funds, each one of them with its own rules of asset management established by their creators. The list above is sorted by 1 month performance.

What happens here is that you can see how the money of the funds are alocated, how and when they change, and what is it's performance, and then decide wich one of them you would like to invest.

It's really transparent, and your will have detalied information about the fund performance.

What matters most here is that you can withdraw your money from these funds at any time, and you don't have to worry if the fund creator will of will not pay you back, because the transactions between investors and fund managers are settled through a smart contract.

Each fund set their own fee for deposits of withdraws.

(You have to trust the platform though, since they are the ones holding your funds, so, dont invest what you can't afford to lose)

Or you can also check this list:

Captura de tela 20200207 15.46.41.png

Looks the same, but here you are allowing traders to operate on the market with the funds you provide without giving them the money directly.

In this case, your funds will be locked for a time, and at the end of the period, you will recieve the profits (or losses), with the trader recieving his share only when there is profits.

You know how to allocate your assets and don't need funds?

With 50 GVT (around 50 USD today) you can also create your own fund or your trade program.

A few warnings before you join Genesis Vision

As everything related to cryptocurrencies, there is always risks involved.

There is no regulation in this market, therefore, there is no institution to resort to if anything goes wrong. So, be mindful that there is always a risk to lose all of your investment.

Also, altough the Genesis Vision model is really interesting and promissing, remember that they are the ones that control the private keys of the funds allocated there, and as always:

Not your private keys, not your coins


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Comments 7


According to the Bible, In Matthew 17: 1-5, was Matthew in the mountain with Jesus?

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07.02.2020 19:07
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I'm convinced that investment funds will play a role. A few people I discuss crypto with really only get back to me when they hear that BTC is being considered as part of a traditional mutual fund or the basis of a crypto mutual. People just do not grasp the idea of digital assets yet. If it were to be easy, I suppose that we would never have had our current intellectual property issues.

08.02.2020 05:27
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In many countries, the use of the name “investment fund” is illegal in all cases without the official permission of the adequate “financial watchdog” (the central bank or other proper state organization). I’m convinced these “crypto funds” you mention aren’t funds, in reality. Investment funds are a sub-category of “collective investment vehicles”, you may find regulations by this concept:

Collective investment vehicles may be formed under company law, by legal trust or by statute. The nature of the vehicle and its limitations are often linked to its constitutional nature and the associated tax rules for the type of structure within a given jurisdiction.
https://en.wikipedia.org/wiki/Investment_fund#Constitution_and_terminology

OK, I’m not a financial watchdog, I stop to preach. I personally prefer buying the main cryptos themselves and keep my private keys safe, offline. But I suppose it is possible to make secure smart contracts in the future to form sort of “collective investment vehicles.” Maybe Genesis Vision made it on Ethereum blockchain. (I read parts of their FAQ but I have still some questions.)

5000+ different cryptocurrencies on the market.

I don’t think more than 200–300 can be serious.

(Your score on Grammarly is 50. That means, 50 percent of people are making fewer grammar errors. At least activate spell checking in a word processing program.)

08.02.2020 15:49
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I don’t think more than 200–300 can be serious.

I wouldn't even think that 200-300 are.

12.02.2020 11:22
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@tipu curate

08.02.2020 16:11
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Upvoted 👌 (Mana: 5/25 - need recharge?)

08.02.2020 16:11
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Thanks for this post. It is quite informative and I find it interesting, I will keep it in my bookmarks to check later with the sites you recommend.

08.02.2020 20:52
0