Purple Group plays to rand demand for bitcoin – Business Day

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Purple’s GT247.com platform decided to offer bitcoin and Ethereum broking services from March after receiving “strong demand” from clients, said Barry Dumas, trading specialist at the group. “We are seeing a lot more engagement from international institutions like banks and international exchanges looking to regulate cryptocurrencies, as I suspect they want it to be a legitimate asset class in the future.”

South Africans can buy cryptocurrencies on local exchanges including Naspers-backed Luno and Ice3x, or can get exposure to digital currencies via the local desks of international brokerage houses such as Saxo Bank.

In addition to allowing short-selling — a mechanism that lets investors benefit from falling prices — Dumas said GT247.com allowed clients to trade bitcoin and Ethereum directly in rand. “Your rands aren’t converted into dollars like some offerings out there, which can expose you to exchange risks.”

While cryptocurrency trading volumes had declined significantly over the past 12 months — owing to the global drive towards regulation, exchanges being hacked, and other reasons — “we have seen a decent amount of interest” from mostly retail clients since the service was launched.

And most clients were banking on higher prices as buying interest outstripped short positions, he said. “We are seeing a decent spread between the bulls and bears but the bitcoin bias in the market is still to be long.”

Dumas said there were indications that the cryptocurrency market was starting to stabilise as clients became accustomed to it and as regulators took action. “We still see some volatility but it’s not at the levels we saw last year.”

hedleyn@businesslive.co.za