If you are looking to gain exposure as an investor to the fast-growing digital asset sector You can make a bet on cryptocurrency exchanges.
Crypto exchanges are in the heart of the world’s crypto market and are one of the highest-profitable and fast-growing firms in the sector and are a lucrative investment if you select the best one(s).
Find out three ways to invest in cryptocurrency exchanges.
1. Buy Stocks that are traded publicly on Exchanges
Perhaps the most convenient method to add the crypto exchange risk to your portfolio investment is to purchase shares of publicly-traded crypto companies offering exchange services.
For instance, you can buy shares of Coinbase which is a cryptocurrency trading platform that is listed on the Nasdaq exchange under the ticker COIN. The company has an estimated market capitalization of USD 65 billion, making it the biggest crypto exchange-traded publicly within the US.
Additionally, in addition to Coinbase, You can also purchase shares of publicly-traded fintech firms that offer cryptocurrency trading services in addition to traditional capital market investments. For instance, you can purchase shares in Robinhood that allow cryptocurrency trading through its app or parts of Block (formerly Square), which allows users to purchase as well as sell bitcoin (BTC) via its well-known Cash App.
2. Buy Exchange Tokens
Another method of investing in exchanges for crypto is to purchase and keep exchange tokens, which act as indirect exposure to the performances of the exchange issuing them. You can buy exchange tokens from the exchanges that have issued them, and generally, they are traded on the major trading platforms.
You could, for instance, buy BNB‘s BNBtoken as an investment proxy in the growth of the giant crypto company. Although exchange tokens, such as BNB aren’t exactly the same as stocks. Their values generally correlate with the performance or lack thereof of the issuer.
There are many other exchanges to issue exchange tokens. Many of the top cryptocurrency exchanges are able to issue their own currency in order to finance their expansion by providing token holders with discounts and other advantages through their exchange platforms.
Crypto.com, FTX, Huobi along with KuCoin have also launched exchange tokens, which have seen significant growth in the number of investors and traders in the crypto space.
Below is an exchange token list you can buy that is ranked according to market capitalization (as of December 31, 2009, at 9:00 UTC).
Purchase Shares on exchanges that are part of the private Markets
In addition, you can invest in exchanges by purchasing crypto exchange shares from the private market by private placement directly or through a counterparty who is specialized on private placements.
For instance, you could also make an investment in an exchange by pre-IPO placings. This occurs when the initial public offerings ( IPO) underwriters offer discounted stock to a small number of investors prior to the IPO. For a chance to be part of an IPO pre-placement it is necessary to locate an agent who is specialized in sales prior to an IPO.
Perhaps the most efficient method to buy shares on cryptocurrency exchanges that are private is to use trading platforms that trade shares privately, such as BnktotheFuture…
On BnktotheFuture you can invest in shares that are private of crypto-related businesses like BitFinex, Blockchain, Circle, and Kraken. Although the Fintech startup’s investment platforms are accessible only to Qualified Investors, it does allow investors to begin investing in cryptocurrency exchanges for only USD 1,000.
If you think that the crypto market is expected to continue to grow and eventually become a component of the world capital market, then adding the possibility of crypto exchange to your portfolio is likely to be beneficial since exchanges are among the first ones to reap the benefits of an increase in crypto trading.
There are however clear distinctions between purchasing shares on an exchange that trades publicly such as Coinbase and buying exchange tokens in the form of BNB or FTT or FTT, and purchasing shares of a private company. Each one has different dangers and pay-offs which is why it’s important to conduct thorough research and be aware of what you’re purchasing prior to making an attempt to invest in the crypto exchange market.