Bitcoin ETF, Market Value Exposure Beyond Trillions of U.S. Dollars

[RyanHuang]

Bitcoin ETF, namely Exchange Traded funds, is a cryptocurrency trading fund. Traders can gain exposure to Bitcoin through the traditional stock market without buying and selling cryptocurrency assets directly on the cryptocurrency exchange.

At present, the well-known Bitcoin ETFs in the market mainly include GTBC, the Bitcoin fund launched by Grayscale and BTCC, the trust fund established by Canadian asset management company Purpose Investments Inc.

Both are valuated in traditional fiat currency, which is a regulated and compliant traditional financial product. Fund companies will hold physical Bitcoin for each share purchased or traded by investors and put it in the custody of crypto companies in a cold wallet, rather than tracking asset prices through financial instruments such as derivatives or futures contracts. Investors can enter the Bitcoin fund market through fiat currency. This helps more investors with traditional fund preferences to enter the cryptocurrency market.

However, the Bitcoin trust funds in the market originate from many regions and institutions, so the product types and user thresholds of the funds are different.

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[avikz]

Not all fund houses hold physical bitcoins. Because it's hilarious to see when the market value of an assets has not reached trillion dollars but the ETF holding is valued at trillion dollars. Majority of the bitcoin ETFs and futures are not holding physical bitcoins. It's just a method of making money with money by the traditional financial corporations.

If all ETF companies hold physical bitcoins, the bitcoin market cap would have reached a value of trillion dollars. But that's not the case anyway!

[joniboini]

Those numbers mean nothing. Retail investors should never focus too much on it if they don't understand what they're playing at. I agree that this trading platform is just a new way for big players to get more money, while retail loss more as usual.

If anything, holding 'real' bitcoin should be the first goal for them before thinking of playing with ETF imo.

[bitmover]

Those numbers mean nothing. Retail investors should never focus too much on it if they don't understand what they're playing at. I agree that this trading platform is just a new way for big players to get more money, while retail loss more as usual.

If anything, holding 'real' bitcoin should be the first goal for them before thinking of playing with ETF imo.

I agree.
ETF are very good for institutional investors, those that can't buy bitcoin directly due to regulations. For example, pension funds cannot buy a bitcoin a put in wallet because there are many laws which do not let them buy whatever they want, but they are able to buy an ETF.

For individuals, there is no reason to pay 2% of fees every year to the fund (which would consume about 18% of the total amount in 10 years). ALso, holding bitocin is much better for privacy, freedom and so on.