AltCoinTrader Crypto Exchange Adds Dollar-Linked Option to Reduce Bitcoin Premium
AltCoinTrader, a Johannesburg-based cryptocurrency exchange, has added a new bitcoin product, linking the US dollar to the platform in an effort to drive down bitcoin’s premium in South Africa’s market as well as attract more foreign investors.
According to a partner at AltCoinTrader, Richard de Sousa, due to the demand and supply dynamics in the local market, bitcoin trades at around 6% to 7% premium. By making a move to open up the market to more foreigners, the exchange will effectively narrow the valuation gap with time.
In July, the 3-year old cryptocurrency exchange AltCoinTrader announced a new trading pair – bitcoin/USDT to give its users more trading option. Tether’s USDT crypto is known as a “stable-coin” backed by the US dollar.
The New Product is Expected to Open Doors to US-based and other Investors
The new USD link is expected to help open up to other investors, including those based in the US.
“The trading pair is quite important because it allows people to buy bitcoin without using rands,” said De Sousa. “They will level the price [of bitcoin] and make it more competitive. There are massive arbitrage opportunities.
De Sousa further said that driving down Bitcoin’s premium won’t happen overnight and could take some time, but those who see the great opportunity and are willing to capitalize on it will benefit tremendously.
Earlier on, it was almost impossible for foreign investors to trade bitcoin in South Africa since they would be required to first bring their money into the country, something that involves a costly process.
According to De Sousa, the company plans to conduct a marketing campaign targeting the United States in the coming months once they are done “ironing out any kinks”.
As is the case with other cryptocurrency exchanges, AltCoinTrader’s trading volumes have cooled down after a cryptocurrency sell-off which has been witnessed so far in 2018.