It happens. The trade you've been following went zig instead of zag. Every forex trader knows the pain of holding a trade just to watch it gap below your stop loss Sunday night. Maybe the metrics you have been using just weren't right. You can't wait to see what the newest metrics are, but you have to wait for the institutional investors to trickle the data down the line and when it finally reaches you the trend has already started.
This is every retail trader's worse nightmare and it happens ALL OF THE TIME... but what if you could see the same data that the institutional traders see real time and at a fraction of the cost? I'm going to break down a couple blockchain projects that can level the playing field. The dot-com boom showed us the benefit of decentralizing our markets. Blockchain hopes to take that even further.
I first heard about Streamr back in Quarter 3 or Quarter 4 of last year when I was watching a conference on Ethereum. Full disclosure I'm invested in Streamr, Golem, OmiseGo, and Ethereum. Unfortunately because I am a US citizen I wasn't able to participate in the ICO or Presale, but I scooped up my bag as soon as they hit the exchanges. I'm a huge believer in the project because I see real-world uses. Most projects on the blockchain are wild and highly speculative overhyped projects which is why I find that when I'm looking to invest in cryptocurrency I want a project that aims to solve real-world problems. I'm a forex trader so I don't have to dive far into their whitepaper to get an understanding of what Streamr can do for me. You should still do your due diligence and research everything before investing. I'll post links.
So here is my ELI5 attempt at explaining how the Streamr platform works. Say you want some data. It could be anything not just market data. I wrote an article on The Internet Of Things. How many steps did you take? Fitbit can help. Did your package arrive? Amazon will let you know. Who knows who's at the door? Your door knows. Using the internet of things can bring a revolution to how gather data but there is a catch...
With the recent breach of Facebook it's a somber reminder why we need secure AND available data. Streamr hopes to bring the security and efficiency of blockchain and mesh it with our current information sharing age. Their motto is "Unstoppable Data for Unstoppable Apps". It connects data providers with data purchasers. When you open the gateway for providers to publish data you create a competitive market which helps disrupt monopolies.
Real time economic reports for a fraction of the cost.
OmiseGo will be a great replacement for our current ECN broker system which connects sellers to buyers. Forex brokers can connect their platform to the OmiseGo Whitelabel SDK and provide liquidity to the network. Think of the forex brokers being the on-ramps to the OmiseGo Highway. You can read the details on their whitepaper.
This won't protect you from having a bad internet connection, but it will create a stronger connection between the buyer and the seller. Instead of having a few nodes responsible for connecting trades there will be a network of hundreds and thousands of nodes that are all responsible for making that connection using cryptography. If you own OMG tokens you can add them to a pool and get paid a percent for each transaction made. If you own 10% OMG tokens in that stakeholder pool you get 10% of the fees that were collecting through transactions. More brokers that adopt this technology means more liquidity to the market and more economic incentive for people to adopt the technology. It will have an exponential adoption curve which is good for both stakeholders and forex traders.
Instead of brokers using fiat receipts there will be tokenized versions of the fiat currency. USD, JPY, EURO, and others will all have their own tokens that the banks can count. The forex brokers are still able to decide what tokens they wish to allow being traded so they can still follow on-shore and off-shore regulations.
This is just a taste of what crypto can bring to the table. Last year we saw the ICO craze and everyone wanted to see have a piece of the pie. Investing is the art of moving equity from the inpatient to the patient so keep watch on these two projects.
Let me know if I missed any projects that you guys think will help revolutionize the Foreign Exchange Market. Please follow my blog and check out my Reddit Sub. You can also find me on Twitter and Facebook.