Daniel Masters, a 50-year-old veteran commodities trader, started working for some of the largest companies in the world right out of university, trading in London, New York and Zug, Switzerland, for JPMorgan Chase and Phibro before moving on to the New York Mercantile Exchange, a short walk from Wall Street. By all appearances, it was your standard Wall Street career.
No sooner did word of the offshore Bitcoin fund get out than Reddit spluttered to life, devoting two pages,Â hereÂ andÂ here,Â to debating whether the virtual currencyâs baby steps into the institutional investing realm is really good news or bad news for Bitcoin, whose meteoric rise has thus far been mostly successful in eschewing traditional finance.
Masters, co-principal of Global Advisors Jersey Ltd.âwhich trades up to $2 billion of energy and equitiesâis the latest of a handful of fund managers trotting out new Bitcoin investment funds in recent months, as investors clamor for innovative ways to skim the froth off the digital currencyâs impressive, if often unpredictable, price pops and drops and, occasionally, collapses.
Then, in 2008, he moved to a tiny island off the coast of France called Jersey, which this week opened its doors to the islandâsÂ first fully regulated Bitcoin hedge fundârun by none other than Masters himselfâas part of a push to create aÂ nascent Silicon Valley in the heart of the English Channel, replete with government-funded entrepreneurial hubs and startup accelerators.
In Liberty, Michael Krieger
This week, Netagio, based in the Isle of Manâa Crown dependency, like Jerseyâannounced the debut of a London-based Bitcoin exchange that will allow individuals to trade BitcoinÂ against the British pound and gold. Netagio spun off this spring from JerseyâsÂ GoldMoney Network Ltd., which stores $1.4 billion of metals in five undisclosed locations for clients across Europe.
âImagine being able to walk into a car dealership, scan your phone over the price tag of the vehicle you want, and, in an instant, youâve paid, youâve updated your carâs ownership information, insurance, vehicle registration,â Masters says. âYou jump in the car, you drive off, you never have to speak to a single person.â Because a Bitcoin wallet can be attached to inanimate objects, as well as carried on phones, the possibilities are endless, he says.
Full article here.
Speaking from CoinSummit in London, Simon Hamblin, CEO ofÂ Netagio, a year-old U.K. company that specializes in secure Bitcoin storage and is a custodian for the Bitcoin fund being launched by Masters, says any fund must take numerous precautions to guard against the loss of Bitcoins. âWe keep our Bitcoin in cold storage, in different forms both physical and media, and always keep it offline, heavily encrypted and in multiple locations,â he toldÂ Newsweek.
I covered GoldMoneyâs move into Bitcoin earlier this year in the post:Â GoldMoney Adds Bitcoin to its Suite of Services.
Masters, the former spouse of another commodities kingpinâJPMorgan Chaseâs recently departed global head of commodities, Blythe Mastersâsays the Jersey Bitcoin fund will target up to $200 million in Bitcoin investments in the first six months to a year and ramp up from there. The fund went through a yearlong approval process via the islandâs regulator, the Jersey Financial Services Commission, which offers a more streamlined process than New York and London do, Masters says. He adds, âIn Jersey, you have one person playing sheriff instead of a dozen.â
We learn from Newsweek that:
âFinance is one of the few industries that is still in need of a disruption,â he told Newsweek.
Hamblin, who says he stumbled into finance from a more technical field, sees Bitcoin as the âperfect merger between technology and finance.â
Blythe Masters is perhaps the most maligned human being on earth by silver investors due to suspicions of JP Morganâs manipulation in the silver market. Well sheâs back in the news, but it has nothing to do with silver. Rather, the news relates to the fact thatÂ her ex-husband and commodities traders, Daniel Masters, has just launched a Bitcoin hedge fund fromÂ the islandÂ of Jersey, a British Crown dependency.
Heâs exactly right. All year, I have maintained that Bitcoin was unlikely to make a major move higher until the summer. Well summer is here, and whether you like it or not, Wall Street is moving in.
He believes Bitcoinâs prices will stabilize as the currency and technology matureâsimilar to what has happened over the past decade with oilâbut in the meantime, he estimates the value of Bitcoin could rise to $2,000 or more. âRight now, Bitcoin has about 1,000 percent annualized volatility,â he says. âCompare that to oil at 15 to 20 percent and stocks at 10 to 15 percent.â In other words, the potential upside, in the eyes of an experienced trader, are too appealing to resist.
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