Johannesburg cryptocurrency exchange AltCoinTrader has added a bitcoin product linked to the US dollar to its platform in a bid to attract foreign investors and drive down bitcoin’s premium in the local market. Owing to supply and demand dynamics, bitcoin tends to trade at a 6%-7% premium in SA, according to Richard de Sousa, partner at AltCoinTrader. By opening up the market to foreigners, the three-year-old exchange is banking on arbitrage trades to narrow the valuation gap over time. In July, AltCoinTrader added a new trading pair, bitcoin/ USDT. Tether’s USDT cryptocurrency, a so-called "stable-coin", is backed by US dollars. "The trading pair is quite important because it allows people to buy bitcoin without using rands," De Sousa said. The product was expected to eventually become "very sought after" as it opened the door to US and other investors. "They will level the price [of bitcoin] and make it more competitive. There are massive arbitrage opportunities. "It won’t happen ...

BL Premium

This article is reserved for our subscribers.

A subscription helps you enjoy the best of our business content every day along with benefits such as exclusive Financial Times articles, Morningstar financial data, and digital access to the Sunday Times and Times Select.

Already subscribed? Simply sign in below.



Questions or problems? Email helpdesk@businesslive.co.za or call 0860 52 52 00.