New ‘TRUMP’ Token Giving 62% Odds of US President’s Reelection

U.S. President Donald Trump tweeted final yr he isn’t an enormous fan of bitcoin and different cryptocurrencies. 

They’re “not cash,” he wrote in July, saying their worth is “extremely risky and based mostly on skinny air.”

Now, crypto merchants outdoors the U.S. could make their emotions identified – and maybe some cash – on the 45th U.S. president. This week a digital token, Trump 2020 with the image TRUMP, launched courtesy of cryptocurrency change FTX.

FTX says the brand new token will work like a futures contract, permitting merchants to take lengthy positions (Trump wins) or quick ones (complete loser).

“TRUMP expires to $1 if Donald Trump wins the 2020 U.S. presidential basic election, and $Zero in any other case,” FTX says in a posting on its web site. 

Some on-line websites, equivalent to Oddschecker.com, have arrange venues to guess on the approaching election, which is shaping as much as be historic: Trump is anticipated to be the primary incumbent president to face voters following an impeachment trial. The president was acquitted Wednesday by the Republican-controlled U.S. Senate of impeachment articles introduced by the Democratic-controlled Home of Representatives. 

However the brand new FTX contract may signify the crypto trade’s first try and money in on the polarized voter local weather surrounding Trump’s 2020 prospects. 

Theoretically, the token’s value ought to monitor roughly in keeping with the perceived odds of a Trump victory. 

“If you happen to assume there is a 52 % probability of Trump profitable, then TRUMP ought to commerce at $0.52,” in keeping with FTX. “Shopping for under there can be good, as would promoting above $0.52.”

The token, which went dwell earlier this week, is at present buying and selling at 62 cents after Trump’s acquittal, implying a 62 % probability he’ll get 4 extra years in Washington.

FTX is owned by a mother or father firm based mostly in Antigua and Barbuda, in keeping with the agency’s web site. It is led by Sam Bankman-Fried. His LinkedIn profile reveals him to be a former dealer with the New York-based agency Jane Avenue who jumped into the crypto trade in 2017. He’s now based mostly in Hong Kong. 

For merchants leery of the dangers of risky crypto markets, FTX posts a warning on the binary nature of the TRUMP token’s final payoff: Worth swings is perhaps much more risky than the notoriously up-now, down-now bitcoin. (Bitcoin is up 36 % to date this yr to about $9,800, after the value almost doubled in 2019.)

“The chance profile of TRUMP is totally different from BTC,” in keeping with the web site. “It has considerably increased probabilities of making a big transfer (to $Zero or $1).”

Addressing the potential for irregularities within the basic election, the brand new TRUMP token comes with phrases mapping out a contingency plan if the outcomes are muddy and Trump refuses to depart workplace: “Within the occasion that some set of electoral votes can’t be projected” and it’s not possible to find out the winner, “this contract will settle to $1 if Donald Trump remains to be president on February 1st, 2021, and $Zero in any other case.”