Popularity of Cryptocurrencies in 2017
Bitcoin, Ethereum, Litecoin, Ripple and many other cryptocurrencies really exploded in popularity in 2017 as the price of these instruments continued to rocket higher and higher, making thousands of people extremely rich in the process.
In some respects it was a new gold rush because many ordinary people started taking an interest in these cryptocurrencies and buying a few Bitcoins to grab a slice of the pie.
However, as expected, the price of Bitcoin and other markets couldn’t keep on going up forever, and eventually there was a huge price drop across the board, which has left many people nursing some heavy losses and praying for a recovery.
Despite these price falls, these cryptocurrencies are still very popular with speculators and traders, and are still be talked about on financial blogs, websites and TV channels on a daily basis.
Cannabis Stocks and ETFs
With the legalisation of cannabis in Canada, and a potential relaxation of laws in other countries around the world, there has also been a huge rush to buy shares in companies that are involved in the cannabis industry.
ETFs have been set up that invest in a selection of companies in this growing sector so that individuals can get a broad exposure to this industry without having to select individual companies, and the price of these ETFs has really rocketed higher in the last few months.
Two of the most popular ones are the Horizons Medical Marijuana Life Sciences ETF (HMMJ) and the ETFMG Alternative Harvest ETF (MJ), and you can see from their respective charts below that they have both risen by more than 50% since August:
As a result of these price moves and the increased media coverage, more and more traders and investors are taking in interest in these cannabis stocks and ETFs because of the enormous potential to make future profits from the opening up of this industry.
Indeed as interest in cryptocurrencies has started to wane in 2018 with less volatility and fewer wild price swings, it is the cannabis / marijuana stocks that have become the ‘next big thing’ this year.
Implications for the Forex Trading Industry
I think it is fair to say that forex trading has definitely been overshadowed by both cryptocurrencies and cannabis stocks in the last couple of years.
While it is true that there will always be a large forex industry with many participants from all over the world, there is no doubt that traders are increasingly looking to these alternative markets in the belief that they can potentially generate more profits in the long run.
Subsequently, forex brokers are desperately looking to capitalise on these trends and compensate for any reduction in forex trading activity by their traders.
Therefore you will see that many brokers now offer trading on Bitcoin and a few other cryptocurrencies in the form of CFDs, and have created a range of banners and promotional material that is designed to attract these cryptocurrency traders.
Similarly, I am also seeing a range of banners for cannabis ETFs from brokers who provide the option to buy or trade these markets.
So, if anything, the clever brokers are actually benefiting from the growing popularity of cannabis stocks and cryptos, even if their forex trading profits have flat-lined or are growing at a slower rate.
It is also good news if you are an individual trader because you now have more markets to potentially make money from with the ability to trade these cannabis stocks and ETFs, and more opportunities to benefit from the price volatility of cryptocurrencies because you can take long and short positions, and don’t actually have to buy the cryptos directly.