Chances are you don’t think about Gibraltar a whole lot.
It’s literally a rock in the Mediterranean just south of Spain, which is somehow still technically U.K. territory.
They call it the Rock, and it’s probably most famous to Americans as the Prudential Logo.
But according to a new article, this little country to the South of Spain could be making a major move that might change the crypto game in a significant way.
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So Gibraltar is weighing a major financial change to lure crypto investors to their small country.
In short, they want to form the world’s first crypto stock exchange.
You can read a ton more detail in this article, but what does that mean?
It means Gibraltar would create the first exchange where you can actively buy and sell stock with cryptocurrency, where the value of the stock would be measured against digital currency rather than fiat currency from a particular country.
That might not seem that important, but if you’re a high-level crypto investor, it could be a huge deal.
Basically, crypto millionaires are stuck between a couple of unpleasant choices (I’m not suggesting anyone shed a tear for them, but hear me out):
They can’t exchange their crypto for fiat currency very easily, because that’ll come with huge tax costs. Gibraltar also has low taxes, including no capital gains tax, wealth tax, estate tax, etc. So that’s another plus, but sort of besides the point.
If they’re not going to swallow the bitter tax pill, you might think they could just borrow against the value of the crypto. But they can’t really do that, either, because banks get spooked by the fluctuating value in the crypto market.
So in other words, they have a bunch of money, but they can’t really use it for anything. That’s an exaggeration of course (again, I’m not playing sad violin for these guys, they’re doing fine), but it’s the problem that Gibraltar is trying to solve.
By being able to buy stocks valued against crypto, they can then borrow fiat currency against the value of the stock, because the banks believe that value is more stable.
So Gibraltar is seeking to become a safe haven for crypto gajillionaires.
But if you’re an everyday person reading this, you probably don’t care about that.
The major lesson for us normal folks is that headlines like these just add to the sense that we are in crypto’s Age of Adoption.
As I keep saying to anyone who will listen, the more we see billionaires, companies, or even whole countries build their portfolios and policies around crypto, that’s only going to drive up the demand, increase the stability (long-term), and solidify the credibility of crypto.
We all know crypto is being hammered lately. But it’s certainly not a sign that we’re at the end of the crypto craze.
Jeffry Turnmire and InvestPub do not provide investment advice. Trading involves a substantial risk of loss and is not suitable for all investors. Many traders fail and you should not trade with money you cannot afford to lose. If you need personal financial advice, consult a financial advisor.
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