Presto Labs advises clients to go long on BTC while shorting BCH to benefit from Mt. Gox repayment
Singapore-based trading firm Presto Labs advises clients to bet on the strength of BTC in market-neutral trades and to short BCH in order to profit from the ongoing Mt. Gox repayment.
Our analysis suggests that the selling pressure on BCH will be four times that of BTC, i.e. 24% of the daily trading value of BCH versus 6% of the daily trading value of BTC. Excluding funding rate risk, going long BTC perpetual and pairing short BCH perpetual is the most effective market neutral way to express this view, added Peter Chung, Leader of Market Analysts at Presto.
Presto further hypothesized that those investors who held bitcoin in its early stages were likely wealthy bitcoin holders of Diamond Hand, and were therefore more likely to hold partial compensation rather than sell the asset outright.
However, Presto said that BCH has a much weaker investor base and could sell out in the short term.