Cryptocurrencies soaring - but not without risk

In early March 2017, the value of Bitcoins, the mother of all cryptocurrencies, traded higher than the value of gold for the first time. There is much speculation about the reason. The most likely is speculation that an index fund (ETF) is expected to be launched soon. This would ensure institutional investors access to the cryptocurrency. On the one hand, this step would enormously strengthen confidence in these modern currencies, but on the other hand, it would open the door to high-risk speculation. After the negative decision of the US Securities and Exchange Commission, the price fell by 17% within hours!

Susceptible to fluctuations

Further massive fluctuations are the logical consequence. These are strongly criticized again and again. For example, the leading analyst at BayernLB, Manuel Andersch, says: "A big problem with Bitcoin is its susceptibility to fluctuations. Price gains or losses of 40 percent in a few hours are quite normal." Positive for speculators, extremely bad for the large mass of owners of such currencies. Due to the soaring prices, many dubious trading platforms with Bitcoins are also emerging, which operate outside of any legal control mechanisms and thus involve a high risk of total loss. The development shows that the in itself innovative idea of cryptocurrencies (independence from politics and central banks) leans too much on the current financial system and ignores the positive experiences of the currency systems up to the 1970s (time of the detachments of currencies from real values).

Hybrid currency as an alternative

According to its own information, this phenomenon is being countered by the Swiss association Quid pro Quo, based in Zurich, which has been developing a hybrid currency as an alternative to "classic" cryptocurrencies since the end of 2015. Its currency, E-Coins, is also independent of central banks. A very large portion of the E-Coins issued by Quid pro Quo are backed by a basket of values based on major reserve currencies and precious metals. In other words, there are substantial, not virtual, values behind e-coins. In the beginning, E-Coins were also only available in digital form. In the meantime, however, e-coins also exist as minted silver coins, which represent the silver value.

The investment policy is continuously defined and adjusted by experts. Thus, the price has developed from originally 0.1 € to currently just over 1.5 €, and this without major price fluctuations with negative developments. The value is calculated solely according to supply and demand.

Already 6000 users

What about the control and the seriousness? The association Quid pro Quo gives E-Coins the legal basis and also the security for customers and is responsible for maintaining the value of the "Value Basket". They say that they voluntarily submit to the valid laws of Switzerland. Of course, this also serves to protect the users, who are also members of this non-profit association. Quid pro Quo emphasizes that money laundering, high-risk speculation and dubious transactions are thus effectively curbed. The next service will be launched shortly: the marketplace. Various companies that accept e-coins as a means of payment will be presented there at the start. As a user of e-coins, this opens up the possibility of being able to shop easily around the clock without having to transfer sensitive data such as credit card or bank details. In addition, there are no fees. In return, companies would be given the opportunity to attract new customers and present themselves to a growing number of participants, the creators behind E-Coins are convinced. According to Quid pro Quo, E-Coins has grown strongly since its launch and now counts more than 6,000 registered users; the association puts the total volume of E-Coins at € 71 million.

More information: www.e-coins.com