CEO of Future Forex Harry Scherzer unpacks a unique cryptocurrency arbitrage opportunity that he and his team use to produce investment returns no matter the movement and volatility of the underlying cryptocurrency. Scherzer and his partner have profited handsomely from this cryptocurrency arbitrage since 2017 and decided to offer the opportunity to the general public in 2020. The product essentially allows one to profit off cryptocurrencies without taking on any of the associated risks. This is because the team at Future Forex has eliminated many of the risks for clients, ensuring solid and predictable returns. Low risk combined with a predictable return makes for one attractive investment product. – Justin Rowe-Roberts
On what Future Forex’s crypto arbitrage is offering:
Let me give a very basic introduction to what we do. Here at Future Forex, we do something called crypto arbitrage. What that effectively means is that we facilitate the process of sending money offshore – buying crypto offshore – sending the crypto to South Africa and selling it in South Africa for a profit. The reason we’re able to do so is that cryptocurrencies, like bitcoin, trade at a premium of 2% to 5% in South Africa relative to abroad. Back when I started this, in 2017, I was doing this for myself and making 30% returns. They were extraordinary, the difference in prices. I managed to find this by simply looking at the price on Luno and comparing it to the price of Kraken or Binance abroad and [realising] there was a 30% differential. That margin has decreased tremendously, but it hasn’t been eliminated. So my business partner and I did this in our personal capacities and made loads of money from it with these enormous margins. Over time, these margins have narrowed but we don’t only have to make money for ourselves here, we can make money for the public in general by doing the same thing for them. That’s what we’ve incorporated since the beginning of 2020.
On how it is different to buying cryptocurrencies:
In a market where you want to buy crypto directly, you can make fantastic returns if the crypto doubles in price but you can just as easily lose half your money. We’ve seen both of these events occur in the recent past. Now, where we differ is we take the risk completely out of the crypto fluctuation and instead profit purely off a market inefficiency that we’re able to capitalise on. Therefore, making money off the crypto space, but without the associated risk. So, what we do effectively is we’ve hedged the entire process from start to finish; there’ll be no forex risk and no cryptocurrency risk. Those are both mitigated by our systems so you can ensure you make predictable returns every time you cycle. The process is very clear. We try to make this process as passive as possible for clients. We assist in setting up a bank account locally. We then use our trading algorithms to send the money abroad – by crypto abroad – send the crypto to South Africa and sell it in South Africa at a profit for clients. We will always give our clients a heads up of when they are trading, if they’d like to trade and the minimum requirements to trade. Once you’ve set everything up initially – guided through with a relationship manager who’s an expert in the field – from then on it’s as passive as you’re going to get in an investment of this type with these exceptional returns.
On the risks involved for a prospective investor:
Typically, the risks would be the forex exposure, the cryptocurrency exposure, as well as any third-party risk with potential third parties being used. Those first two market risks are the forex risk and the crypto risk we’ve eliminated through our trading system. In other words, we can predictably tell you, before you even trade, what you’re going to earn regardless of what happens to cryptocurrency or the forex. The reason is we lock into prices at the onset to make predictable returns. While we can’t completely mitigate these third-party counterparty risks, what we can do is manage them to the best of our potential. We’ve managed to do this by number one, handpicking the best and most trusted third parties; and number two, never exposing ourselves and our clients’ money to more risk than required.
Read also:Â
- How do cryptocurrencies derive their value?
- Financial Times perspective: Investors flee gold for cryptocurrencies
- The future of cryptocurrencies is dependent on regulation – David Shapiro
