Gain Capital Holdings Inc (NYSE:GCAP) entered into the cryptocurrency space earlier this month and has seen its shares rise, ever since. Currently, the stock is selling at $11.33 a share, up 15.03% percent for the day, with a current market cap of $511.63 million. Today, reaches a year all-time high for the stock, with its share numbers selling at a price it hasn’t seen since 2014.
Gain Capital is an online trading broker, which makes majority of its profits as a foreign exchange broker operating under the City Index and Forex.com brands. City Index recently launched Bitcoin spread contracts and bets for speculators to make bets on the direction of the price of the cryptocurrency. In the company’s press release back on December 1st, it states that its U.K customers are able to trade Bitcoin either as a spread bet or a contract for difference (CFD) and also have access to competitive spreads, margin and financing, and the ability to take both short and long positions.
The Bitcoin products Capital Gain is offering is in direct competition with the other exchanges and Bitcoin futures taking place in the United States. City Index offers leverage of up to 3:1 and a person can trade Bitcoin in a size that is currently half the price of one coin. The bitcoin futures offered by the CBOE (NASDAQ:CBOE) and CME (NASDAQ:CME) have less leverage and are not suitable for smaller speculators because of the large minimum size of each trade.
Online cryptocurrency exchanges have soared this year, due to the price of Bitcoin skyrocketing over 1100%. Coinbase, the largest digital token exchange in the US, saw 100,000 accounts opened within a single day due to the price of Bitcoin hitting an all-time high.
If Gain Capital can seize just 10-15 percent of the international Bitcoin trading, it could make big impacts on the business and its stock.
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