From shorting to forking. My journey from traditional finance to the world of crypto assets.
For many years I’ve been trading stocks on a daily basis. My career as a professional day-trader started back in August 2007, right when financial markets were staggering. I had the luck to find a place where I could do what I always wanted to do: becoming a player in the market player. So I took a shot.
The end of the story is well known, the entire market collapsed to ridiculous levels, just when I was learning the basics. Nice experience. In the end my biggest learning was not risk management or market functionalities, it was market behaviors. Experiencing the subprime crisis at first hand gave me the opportunity to learn how market players behave in such a scenario and how the price of an asset is madly driven by that action.
At the same time, I learned how unprotected retail investors really are. Unprotected from the media, which usually flood the scene with exacerbated news just to make it worse. Unprotected from greedy financial institutions, which often forget their duties as intermediaries and ruthlessly defraud their own clients. Unprotected from regulators, which most of the time join the party when it is already over.
To cut a long story short, I witnessed how investors lost their savings in a matter of weeks, just to see how the same market only shortly thereafter became the most bullish one since the great depression. What the …?
First lesson: Traditional mechanisms of investing have many flaws that go against the interest of the very same investors they aim to protect. While many intermediaries, professional traders and fund managers make money consistently, retail non-professional investors generally lose.
Soon I became a successful day-trader, but I was still a novice investor. Some of my investments were decent ones, but some others were definitely not. While a bit of risk is in the nature of this job, I soon made another disturbing experience. I was literally ripped off by project developers and fund managers who ran away with my money. Up-to-date, I am still dealing with these lawsuits.
The majority of people don’t even know what a hedge fund or a mutual fund is. But even if you do, finding a trustworthy one is quite a piece of work with all the available information and different options you have to oversee. Once invested, there is no way to real-time track how the managers performance and how responsible and careful she is doing her job. Again, information can be manipulated and to find this out can take a lot of time.
Second lesson: Selecting the proper investment or choosing a person to entrust your money with is hard. But for retail investors it gets even worse as they tend to invest small amounts of money and don’t have the capabilities to properly diversify or do a thorough financial analysis of different options. The lack of transparency or better said, the impossibility to track what a project developer or fund manager is doing with the money puts investors in a vulnerable situation that sometimes leads to suffer frauds or swindles.
Trading has always been a pleasure to me. Watching stock charts at night was probably my favorite TV series, only surpassed by some episodes of Game of Thrones. But after a while it turned into a routine like any other job, so I was on the lookout for new challenges and fund management was on top of my list.
After acquiring sufficient knowledge of market functionality through studying finance as well as trading and investing, I was convinced to open my first investment fund. As easy as it sounds, to open and profitably run one, given tons of regulations, you better count with vast amounts of money and time. Otherwise it could become your biggest nightmare. It is not impossible, but not accessible for everybody.
The easiest way then should be getting a job in an investment bank, hedge fund or any other kind. Here another problem arises: to get a job there can be tough. Most of them ask you for experience, and the big ones won’t take you unless you have studied in a high class university.
Third lesson: Whatever the reason, many capable people with skills and talent are unable to get a job in a financial institution. Traditional institutions put unfilled gap between skills and opportunities. Fund management should not only be available for a selected number of persons; it has to be somehow accessible to all.
Looking for new challenges, life took me to Germany where Midas co-founder Philipp Doğan introduced me to the world of blockchain and digital assets. You can guess the result of this: it blew my mind. It took me only few minutes to see one thing: opportunity. What I saw is a way to solve many of the problems I’ve experienced during my time as investor.
The blockchain brings transparency, increased security, a considerable reduction of transaction costs, decentralization and to me the most important of all: inclusiveness in financial markets.
For fund management and investing, it changed the whole paradigm and took us to a new age. From the very first time, anyone in the world with internet connection can easily become a fund manager and invest in every digitalized asset from the comfort of a cellphone. All in a decentralized, transparent and safe ecosystem ruled by smart contracts.
This is how we eventually came up with Midas.
Invest in what you love. Let others invest in you.
Midas was thought from its inception as a solution to all so-far existing problems for investors resides on the values embraced through blockchain technoogy: transparency, security and trust.
Absolute transparency is our highest bid. And this is not a cliché, we prove it with facts. From day one we opened the doors to anyone that is interested in our company, welcoming questions about our idea, team and the development. Transparency is closely connected to responsibility. We’re responsible not only with our investors and users but also with regulators. Under the guidance of a leading Swiss law firm, we comply with all existing Swiss regulations and simultaneously try to shape legal frameworks with our partners at the Multichain Managers Association.
Security is our cornerstone. Parts of our developer team have long-standing experience in information security research and counter intelligence systems. The technological conception of Midas goes by highest security standards in order to provide a solid, stable and safe environment for our users.
The blockchain is a “trust-less” system. However, as a private company the trust of our customers is our capital. This is why each of our actions is based on our moral and ethical principles. We alwys take decisions considering two questions: 1- is it good for our investors? 2- Is it good for our users?
Learn more about Midas at www.midas.social
