The Biggest Short!

Opinion: BlackStar’s CFO, Joseph Kurczodyna as of 12-28-2017

This is the BIGGEST SHORT in my 43 years of trading Commodities & Securities. As I mentioned in early December, it’s happening fast on the heels of the Chicago Mercantile Exchange (CME) opening of Bitcoin Futures. The high was put in the first day of trading on the CME at 20,650 Bitcoin, Monday 12-18-2017. We saw a low of 12,229 Bitcoin on Friday 12-22-2017 a 40% drop after only 5 trading days on the CME. Traders might legally capitalize on it by selling Futures contracts or buy Puts in BITCOIN, then buying it back under 3999. The margin will decrease as the market falls and volatility wanes, which will put more pressure on Bitcoin. Bitcoin may survive like Crude Oil futures in 1983 or fail like rapeseed, eggs or tulips futures. All cryptocurrencies (coin or tokens) that are not the few 2-3 derivative currencies, or a new recognized listed commodity, may fall to zero. Many of these cryptocurrency companies holding Bitcoin have seen their wallet account soar, but their use of proceeds only to fund an idea with no or little tie to “ownership equity”. My experience in human nature tells me that the principals of those unregistered ICO's may spend their proceeds in salaries and bonus. An eighty percent drop in Bitcoin might deplete most of their holdings.


The 2017 Un-Regulated Coin & Token Crash
ICO's mimic U.S. IPO's sold to non-accredited and accredited investors after SEC review. IPO's go thru registration process as required in the 1933 Securities Act. The ‘33’ Act was brought on by the 1929 Stock Market crash, where we saw young entrepreneurs and old sharks post white papers on the street. The process took 15 minutes to incorporate and one day to write the poster paper. Today you can create a coin or token in 15 minutes and post a white paper on the internet. SEC rules have been in place since 1933, so it could be curtains for all the unregulated equity derivative coin or token deals sold to US investors without securities compliance. The SEC may investigate and order these ICO's to rescind the proceeds of their offering. Then they might re-file with the SEC and hope for their ’33 Act registration to become Effective after comments, the process that protects U.S. investors. The ICO principals could face time in the Cross-Bar Motel (potentially) because of their failure to discloses and their violations of the Securities Act of 1933. You can check-in to a BlockChain, but you can't get out. This cyber-security platform will spread thru industry. The BlockChain cybersecurity feature of anonymous encrypted information on a BlockChain inspired investment of billions of dollars of bitcoin into unregulated equity derivatives and may unfortunately lead to their demise as well. Risk management and transparency will always lie at the center of not only what the SEC does, but the CFTC, the U.S. Federal Reserve, and other regulatory bodies the world over. The SEC may ask for the key to every ICO BlockChain. If ICO’s have ability to disclose, this may violate the security features, revealing information that could bring potential charges for fraud, market manipulation, money laundering and tax evasion. The only unregulated space for coins or token to trade with liquidity is at the bottom of the decentralized Oceans. The SEC is looking at the ‘Principals prior to ICO sales.


I assume the SEC, CFTC, IRS and Federal Reserve converged last Summer and were faced with the potential decentralization and destruction of our Equity and Commodity Markets along with our Monetary System and IRS tax transparency. (The Russians weren’t there).
Why haven’t the regulatory bodies in every country stopped this obvious violation of Securities & Currency Laws?
Conversely, the Board of Governors of the U.S. Exchanges and other Securities Markets are making significant moves to preserve market integrity, transparency, and preservation of our capital markets. The Officials first decided to regulate the head of the beast “Bitcoin”, by allowing Future contracts.

If the SEC had shut down “cryptocurrency” in July it would have meant blood in the streets for all those investors that can now hedge in Bitcoin Futures.


For the Bitcoin to survive as a World Decentralize Currency/Commodity it must trade on a regulated Commodity Exchange.

Bitcoin may eventually separate its association with the bad crypto actors riding its blockchain coat tails. Futures contracts will give users in commerce the ability to hedge their risk while accepting Bitcoin as a convertible currency. The owners of Bitcoin can hedge their asset by selling for future delivery on the Exchange. The speculator can bet against the owners and users that may be lying about supply and demand fundamentals. There is an unlimited supply of futures contracts on the Exchange, therefore it is much more difficult to manipulate prices like the BITCOIN squeeze to the upside prior to Futures trading. The Bitcoin is playing with the big boys in Chicago.


Thanks for the exit into the futures market giving us the ability to hedge our bets on illegal unregistered crypto equities, if they crash. The SEC has been caged up since July, no cell phones, or laptops, just waiting for other officials to say thumbs up, open the gates to the Arena. Crash the cyber crooks, make small change of the crypto minions, and slaughter those unregulated unregistered crypto derivatives.

Leave a Reply

Your email address will not be published. Required fields are marked *