The debate rages: Is it a bubble? Well, if you're a Bitcoin bear, here are a few options to make money if Bitcoin does plummet. If you are a bull, there are corresponding ways to make money off the bears.
Bitfinex is a trading platform based in Hong Kong. Offers traditional methods of shorting for Bitcoin.
Bears: Works like short-selling in the stock market. You can borrow Bitcoin from other users then sell them on the open market. You then buy Bitcoin back at a later time to repay your lender. If the prices dropped in the meantime, you capture the price differential and you have successfully shorted. If the prices rise, well, you just sold low and bought high. OUCH!
Bulls: Lend Bitcoin to those bears!
ICBIT is a Bitcoin derivatives and exchange market which trades futures contracts. There are currently three open contracts which settle on 4.13, 9.13 and 12.13.
Bears: Enter a contract today to sell BTC on the settlement date. If the price of Bitcoin goes down, the buyer still pays the agreed upon price. For example, if you agree to sell BTC for $300 in the future and the price drops to $50, you collect the difference.
Bulls: Enter a contract to buy BTC in the future. If the price goes up, you only have to pay what you agreed to in the contract so you could buy BTC under the market price on the settlement date.
MPEx is a Bitcoin stocks and derivatives market. It's interface is very barebones, but they trade options. For the best explanation of an option trade read on wikipedia.
Bears: An option is similar to a future, so enter a contract to sell Bitcoin in the future and hope the price drops.
Bulls: Do the opposite!
Bets of Bitcoin is a site that allows you to make bets about real world events, including the future price of Bitcoin. Placing a bet is free. Creating a bet costs 0.1 BTC, but you earn a percentage of the losing bets after it is decided.
Bears: Create or place a bet about the future price of Bitcoin. You could bet that it will drop in the future or bet against a rise in the future. But if you win, you will win in a currency that is now devalued.
Bulls: Again, do the opposite!
Camp BX is another trading platform like Bitfinex, but based in Atlanta. They plan on offering shorting in the future, but currently do not.
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