New platforms, like Coinvest, are combining the best of traditional exchanges and investments funds
Anyone who has bought cryptocurrencies recently has probably had to use an exchange, whether that was Coinbase, Binance, Kucoin, or one of the other many exchanges out there. It is likely that you had to use a combination of these exchanges — some for fiat pairs, some for the coins you want, and some for their trading platform. Throughout this process, you probably had to leave your coins on several centralized exchanges, in which they own your coins. This is clearly inefficient and potentially unsafe, and new platforms like Coinvest aim to bridge the gap between all of these separate services, creating one platform that can do it all.
(graphic made by Coinvest)
Coinvest
Coinvest (https://coinve.st) aims to create a decentralized investment platform that combines the best of investment funds and traditional exchanges. Coinvest does not directly accept funds from the user, and instead uses its COIN token. It uses a smart contract and an autonomous trading bot to execute the necessary actions for the positions you enter, and credit users with profit from positions they have taken. Users can then spend cryptocurrencies directly from the platform using their wallet or Coinvest debit account. You can see the full comparison in the graphic below, but I want to highlight the specific features that I think are most important to retail investors:
(graphic made by Coinvest)
No KYC/AML Verification: Identity verification and KYC processes are often long and prone to errors along the way. Sometimes, as we saw with Coinbase, it just never works. Coinvest will not require you to go through this process due to the way it uses the COIN tokens in the platform, saving you from the hassle. This also ensures people from certain areas of the world are not kept out of the platform due to regulatory restrictions.
Decentralization: The Coinvest platform is fully decentralized and all market actions are done through smart contract and an autonomous bot. This is very important because it eliminates the risk present in a centralized exchange, in which a hack could leave you without your coins. This also ensures that there is no human bias or influence in the trading execution, providing a provably fair process.
Shorting: Essentially, shorting allows you make money when the price goes down. This allows traders to make money during bear markets as well as bull markets. Most exchanges, other than BitMEX, that I know of do not include shorting as a feature. Furthermore, U.S. users are not allowed to use BitMEX. This is a huge opportunity for Coinvest, as this feature alone separates them from the leading exchanges.
Margin Trading: Margin trading allows you to borrow funds from the exchange and trade beyond the amount of your investment. This allows you to trade with leverage, adding a multiplier to the amount you earn (or lose) with your trading position. Similar to shorting, to my knowledge, only BitMEX provides margin trading. This is another competitive advantage that Coinvest can easily swoop up.
Index Funds: Currently, if you want to buy several coins, you need to actually buy them separately, and separately watch their prices. Coinvest will allow you to either use existing funds, or create curated index funds that combine several coins, making the process of buying several coins much more convenient. Additionally, you will only have to use the Coinvest platform to do so, instead of potentially needing to buy coins spread across multiple exchanges. These index funds will provide users with an easy way to broadly expose themselves to the general crypto market with low fees and volatility.
With all of these features in their pipeline, and a talented developer team, I can definitely see Coinvest becoming the leading investment platform for cryptocurrencies. The ease-of-use that their platform provides, combined with advanced features like indexing, margin trading, shorting, and derivatives, makes it a clear winner for both new investors and seasoned traders.
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