Why Bitcoin hit $60,000 | Huge Catalyst!

by the way at the end of this video i'll

also mention to you whether or not i'll

be investing in this hey everyone me

kevin here this video is sponsored by a

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public okay folks let's get right into

this the sec

is potentially going to allow a bitcoin

futures exchange traded a fund something

that kathy wood has applied for as well

in recent weeks and take a look at this

upon the news of or the publishing of

this news from bloomberg we saw bitcoin

essentially gap right up from about

fifty seven thousand two hundred up

about two thousand dollars to where we

sit now about fifty nine thousand four

hundred we did run to a high folks a

recent high here of sixty thousand and

two dollars now why is this so exciting

well because we are expecting a bitcoin

etf to get approved in the future and

some folks see a bitcoin futures etf as

the first step towards a more broad

etf now futures is basically a contract

and we're going to talk about the

difference between futures and options

here to purchase or sell a certain

amount of cryptocurrency in this case uh

bitcoin in the future could really be

any kind of commodity it could be the s

p 500 futures whatever right it's a

promise to buy or sell a set amount of

something in the future

and the sec actually has a bulletin out

on bitcoin futures now it's not

specifically about bitcoin futures uh in

terms of an etf but this is from june

10th and so some folks are referring to

this bulletin as sort of maybe like hey

like this was the the heads up in the

summer that maybe a bitcoin futures etf

was going to be able to uh be approved

the

one thing that's really neat about this

is they mentioned here that in the

united states bitcoin is a commodity uh

which is fascinating because a lot of

folks see a bitcoin as a currency which

is treated differently as a commodity

and perhaps most importantly people

generally do not want cryptocurrency to

be deemed a security because it opens

you to a lot more regulation with the

securities and exchange commission the

sec and here they are literally saying

it's not a security in effect or at

least that's the way it's viewed now

but then this is just the sec this is

just saying the way things are looked at

right now but either way

a lot of futures contracts are based on

trading commodities and folks see this

as kind of the

gateway drug so to speak of getting into

an actual bitcoin etf and full-on

cryptocurrency regulation this is why

bitcoin jumped because it's seen as very

very bullish now

why do we think that this bitcoin etf is

going to get approved well it's because

of this right here a bloomberg article

saying

that according to people familiar with

the matter the sec is not

likely to block bitcoin futures etfs

from

starting to trade next

week and again these are not bitcoin

etfs where people could hold bitcoin

essentially directly through an exchange

traded fund which would essentially mean

being able to buy

shares of bitcoin on the stock market

that's different this is being able to

buy shares in futures contracts

on the stock market where somebody else

is promising to buy or sell a certain

amount of cryptocurrency so a little bit

of a differentiation there but kind of

good because the sec if they were super

anti-crypto could easily come in and

block this and it's very very good that

we're not seeing a block to this it is

uh definitely a step in the right

direction now what's what is futures uh

where what is a futures contract and how

does that compare to maybe something we

might be more familiar with like an

options contract so an easy way to think

about futures is that whatever you're

promising to buy

you don't have an option to buy you have

a commitment to buy that's why we call

options options when we buy a call

option we have the option it's our

choice

to actually buy the underlying stock

let's say if we're talking about trading

options for stocks

if you

uh purchase a put you have the option of

making somebody else buy your shares at

a certain price

as long as that price

is above what the current price is so

you have this choice as a buyer of

option contracts to force somebody else

to do something to either sell you

shares or to

buy your shares in the case of call

options you could force somebody to sell

you shares uh in the case of

put options you could force somebody to

buy your shares at potentially a higher

price right or for calls sell you

something at a lower price

that's the point of options but you

don't have to you don't have to get rid

of your shares you don't have to buy

those shares if you don't want to with a

futures contract you are committing to

take delivery of whatever that contract

is by the end date if you still hold the

contract by the end date now you can

trade futures contracts but the downside

of trading futures contracts is that

unlike options contracts futures

contracts are what are known as marked

to market every day so for example if

let's say you have a call option on gld

or gold and you spend three thousand

dollars in premium for the right to buy

a thousand shares of gld for 168 dollars

on november 19th

now that's a 3 000

option you have to spend 168 000 on gld

or the ishares gold fund in the future

you only needed 3 000

for that contract

so if you get to the expiration date and

you're like i don't have the 168

thousand dollars to actually buy gld at

168

times a thousand

shares because you have uh you know 10

contracts of it let's say

then then that's okay you are not

obligated to buy the shares of gld you

don't need the 168 000 you can have the

option contracts uh and if you don't

want to buy you just let it expire

or trade it away

the difference though with futures

contracts is if you had a future

contract to buy a hundred sixty eight

thousand dollars worth of gold in the

future whether that's actual gold or

shares of gold through some kind of fund

you are on a daily basis going to be

required to stake a certain amount of

capital

to show that you are going to be capable

of executing that purchase at the end

this is staking margin and every single

day your contract value gets marked to

market you don't have to stake the whole

thing but if all of a sudden the price

of gold goes up a lot you're going to

have to keep putting money in or

otherwise you get margin called your

option won't just expire or worthless if

you don't want it or you just choose not

to take the shares because even though

you might be in the money all of a

sudden you just don't have the 168

thousand dollars it does not matter

whether you were in the money or out of

the money on expiration date you have to

buy that gold if you committed to buy

that gold and you're holding the

contract on that end date

so futures uh therefore carry a little

bit more risk see as a buyer of that

gold call contract you're limited to a

three thousand dollar risk that's it

that's your limited risk you could trade

that all you want if that money

evaporates oh well you lose three

thousand dollars that's your max risk

but your max risk with a futures

contract is that gold let's say

skyrockets you promise to pay it you are

going to and let's say gold doubles

you're going to have to come up with 330

000 to actually buy the gold or get rid

of the contract and you're going to have

to deal with spending a lot of money

you're not just losing three thousand

dollars you're losing way more

potentially and so futures contracts

therefore a little bit more risky again

you're making the commitment

to actually buy or sell something you

get mark to market on a daily basis and

there's a lot more risk in this sure you

could day trade these a lot of people

day trade futures and then they don't

want to hold them overnight because of

that mark to market

but folks keep in mind

that whether you like futures or you

like options or quite frankly you don't

care about either of them

what happened here with the sec and

bitcoin at least what is rumored to be

happening is bullish for cryptocurrency

remember that the sec chairperson gary

gensler says that regulation for

cryptocurrency is like regulation for

cars in the early 1900s before we had

regulation we didn't have seat belts we

didn't have traffic lights people were

afraid to use cars because they were

deemed dangerous people were unfamiliar

with them when we got regulation people

learned about using blinkers people were

required to use blinkers and brake

lights and we had stop signs and traffic

lights and seat belts all these things

slowly came out as innovations not

necessarily in that order

but anyway people then became a lot more

comfortable with driving vehicles and

therefore vehicles exploded in

popularity and people believe that same

explosion and popularity could happen in

cryptocurrency if we finally get some

modest regulation certainly we don't

want china-level regulation where

everything is getting banned all right

now what do we think price-wise and is

this something that i'll actually invest

in so uh price-wise first of all for

bitcoin this is bullish when we actually

get formal approval i would expect that

this is not actually going to be a buy

the rumor sell the news this is going to

be a buy the rumor by the news uh i

would expect that cryptocurrencies will

do well when this gets formally approved

because this is just a rumor obviously

if it doesn't get approved we could see

some temporary weakness in

cryptocurrency uh but it would just be

temporary we're on a nice trend uh a

nice upward trend right now i added some

more cryptocurrency yesterday uh and uh

bought so right as this news came out

within like the first

minute of this news coming out so i was

able to get a good price i was able to

send an alert to everyone in the stocks

and psychology of money group as well

where i send crypto notifications also

but uh now going forward what about a

futures etf would i buy a futures etf

probably not

for me i don't i'm not so interested in

playing uh futures i'm not as well

versed in futures as i am at options i

would rather just huddle the actual

uh the actual uh

bitcoin uh now i think the futures etf

could be interesting for some

institutional investors but i really

don't think a lot of retail investors

are going to get involved and i maintain

that the best way to buy cryptocurrency

is just go to something like

coinbase.com and buy the cryptocurrency

maybe transfer it to block five where if

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that's why you earn the yield but yeah

for me i'm a big fan buy and huddle

right now and this is nothing more than

a positive catalyst that will lead the

way to more ideally positive regulation

for cryptocurrency so there you have it

thank you so much for watching this

video make sure to go to metkevin.com

public to get up to 70 dollars in free

stock and you can now buy or sell

cryptocurrency thank you so much for

watching this video and folks we'll see

in the next one bye

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