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mccorvic
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October 28, 2013, 06:44:59 PM |
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It doesn't mean anything as it's not actually approved yet. But when it does get approved, it means institutional investors and firms will have an easy way to throw funds at BTC without actually holding BTC. (Not sure why they'd want that, but hey.)
Of course as more shares are bought, Winklevii will have to purchase additional BTC to be represented, and of course as shares are sold they'd liquidate. Not sure *exactly* how it works, but I think that's the general gist. In the end, purchases of this ETF will (not-quite-directly) contribute to increased demand, and also the opposite.
I'd be curious to get a precise answer on this for my own curiosity. I've heard that the fund won't buy more coins, but just make profit and payout on the increased value of the 100k coins. I've also heard that they will buy more coins as they get more investors. And now with someone else in this thread, apparently they might sell coins? Does anyone actually know? Does this EFT or whatever force them to buy/sell/hold/eat/hump coins or can they do whatever they want with them? |
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There are several different types of Bitcoin clients. The most secure are full nodes like Bitcoin Core, but full nodes are more resource-heavy, and they must do a lengthy initial syncing process. As a result, lightweight clients with somewhat less security are commonly used.
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molecular
Donator
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October 28, 2013, 06:55:47 PM |
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It doesn't mean anything as it's not actually approved yet. But when it does get approved, it means institutional investors and firms will have an easy way to throw funds at BTC without actually holding BTC. (Not sure why they'd want that, but hey.)
Of course as more shares are bought, Winklevii will have to purchase additional BTC to be represented, and of course as shares are sold they'd liquidate. Not sure *exactly* how it works, but I think that's the general gist. In the end, purchases of this ETF will (not-quite-directly) contribute to increased demand, and also the opposite.
I'd be curious to get a precise answer on this for my own curiosity. I've heard that the fund won't buy more coins, but just make profit and payout on the increased value of the 100k coins. I've also heard that they will buy more coins as they get more investors. And now with someone else in this thread, apparently they might sell coins? Does anyone actually know? Does this EFT or whatever force them to buy/sell/hold/eat/hump coins or can they do whatever they want with them? contains relevant information regarding this. EDIT: maybe post #79 could be a good starting point EDIT2: it also contains a bit of a battle between NewLiberty and DrGregMulhauser  |
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NewLiberty
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October 28, 2013, 06:57:51 PM |
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It doesn't mean anything as it's not actually approved yet. But when it does get approved, it means institutional investors and firms will have an easy way to throw funds at BTC without actually holding BTC. (Not sure why they'd want that, but hey.)
Of course as more shares are bought, Winklevii will have to purchase additional BTC to be represented, and of course as shares are sold they'd liquidate. Not sure *exactly* how it works, but I think that's the general gist. In the end, purchases of this ETF will (not-quite-directly) contribute to increased demand, and also the opposite.
I'd be curious to get a precise answer on this for my own curiosity. I've heard that the fund won't buy more coins, but just make profit and payout on the increased value of the 100k coins. I've also heard that they will buy more coins as they get more investors. And now with someone else in this thread, apparently they might sell coins? Does anyone actually know? Does this EFT or whatever force them to buy/sell/hold/eat/hump coins or can they do whatever they want with them? Here is the S-1 http://www.sec.gov/Archives/edgar/data/1579346/000119312513279830/d562329ds1.htmThe section on creation and redemption of shares explains it, but the basics are that more bitcoin can be bought or sold to fund or defund the ETF depending on the activities of the "Authorized Participants" who can do this in "Baskets" of 50K Shares of the WBCT (Winklevoss Bitcoin Trust) These Baskets of 50K shares will be equivalent to a declining number of actual bitcoin (over time) as bitcoin will be sold to pay the costs of maintaining the trust. When a new Basket of 50K shares is created (because the Authorized Participants are selling a lot of them to their customers) the trust will buy more bitcoin. When a Basket is redeemed, this often means that bitcoin will be delivered in redemption, however the trust reserves the right to pay out in fiat Dollars instead of bitcoin in the value of the bitcoin at the time of the redemption request. |
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ChartBuddy
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October 28, 2013, 07:02:28 PM |
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justusranvier
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October 28, 2013, 07:06:20 PM |
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When a Basket is redeemed, this often means that bitcoin will be delivered in redemption, however the trust reserves the right to pay out in fiat Dollars instead of bitcoin in the value of the bitcoin at the time of the redemption request. In other words, they've left themselves room to sell more ownership in Bitcoins than they actually have, just like what happens with every other financial product. Wall Street wants a monopoly on this kind of fraud, so they make it a felony for everybody except themselves. |
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SheHadMANHands
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October 28, 2013, 07:10:11 PM |
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Engage seat belt. That chart is lookin hurtin for a squirtin'.  |
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SheHadMANHands
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October 28, 2013, 07:17:56 PM |
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Buyer contacted me on localbitcoins for an in person meetup (probably tomorrow). I'm in a smaller town, so doesn't happen often (once like 6 months ago). He's been following the action and wants in.  Word slowly getting out.. more media attention the better (and they'll be a ton if we bust through the ATH). |
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ChartBuddy
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October 28, 2013, 08:02:17 PM |
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ArticMine
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Monero Core Team
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October 28, 2013, 08:02:44 PM |
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EDIT: I'm not sure what the above poster meant by "about to cash out." Filing or approval in no way means Winklevii will be selling any or all of 100k coins at market the instant they are approved. They have to own the coins that the shares represent. They don't get to just sell them when ETF is approved, that makes no sense and then they wouldn't have an ETF. They hold the coins as specified in the filling. As more investors pile in they'd have to purchase more coins. Or the opposite. You get the picture.
Rigth now they personnaly hold those coins. Once the ETF is approved, they will give them to the ETF, and in return the ETF will issue shares to them. At that moment they will be the only ones holding shares. Then they will sell them on the market. Therefore, cash out. Edit : it doesn't mean a single coin has to be sold nor move. 100% of the coins will still belong to the ETF. Only them will have a little less ETF shares and a bit more dollars. This assumes of course that the Winklevii choose to cash out, if they do not then the ETF will have to purchase BTC on the open market to back up the shares. |
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SheHadMANHands
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October 28, 2013, 08:38:41 PM |
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Why would the Winklevoss be selling their shares (granted, to other investors) if they're still "very bullish" on bitcoin? Wouldn't it obviously be in their interest to purchase more bitcoin for any other investors in the fund, since that would just drive the price up further anyway?
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windjc
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October 28, 2013, 08:46:38 PM |
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Why would the Winklevoss be selling their shares (granted, to other investors) if they're still "very bullish" on bitcoin? Wouldn't it obviously be in their interest to purchase more bitcoin for any other investors in the fund, since that would just drive the price up further anyway?
I have a better question. Why do dozens of people on this forum who have never had any direct interaction with an ETF and no direct knowledge on the underlining motivations for starting and running one, have a fracking opinion they think is worth sharing on this forum?  ETF = good for valuation of bitcoin. That is all anyone needs to know. So much freaking hot air in here. LOL |
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ChartBuddy
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October 28, 2013, 09:02:21 PM |
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DougTanner
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October 28, 2013, 09:04:43 PM |
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Huh, Gox crashing  .  |
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wobber
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October 28, 2013, 09:08:54 PM |
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Even lower this time I presume. Operation Bubblepop in progress.
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notme
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October 28, 2013, 09:11:39 PM |
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Even lower this time I presume. Operation Bubblepop in progress.
Beginnings of wave C? |
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Walsoraj
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October 28, 2013, 09:14:07 PM |
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Did Gox lead that mini-dump?
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JimboToronto
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You're never too old to think young.
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October 28, 2013, 09:24:33 PM |
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Even lower this time I presume. Operation Bubblepop in progress.
LOL Bubblepop? That's the sound of champagne bottles opening in anticipation of the ATH. |
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windjc
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October 28, 2013, 09:27:16 PM |
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I have a better question. Why do dozens of people on this forum who have never had any direct interaction with an ETF and no direct knowledge on the underlining motivations for starting and running one, have a fracking opinion they think is worth sharing on this forum? I do know how ETF work. In fact my stock portfolio is almost only composed of ETFs (with two lines only, one from my country's stock exchange, one from the US one). ETF = good for valuation of bitcoin. That is all anyone needs to know. So much freaking hot air in here. LOL
I agree. Most of people here don't understand this. Yeah, I was not obviously referring to you. Its actually funny, (although it annoys me when I am actually trying to find real-important-topic-related-info in a thread), how stupid so many of the bitcoin early adopters are. I mean, there is literally this unrefined, ignorant, idealistic, caveman like quality to so many of these early adopters. Bitcoin is entering a time where (HOPEFULLY!!!) more and more legitimate, well financed, regulated, structured 3rd wave Bitcoin companies, users and investors are going to enter the BTC universe. And eventually they will help drown out the noise. I mean hats off to the non-authoritarian idealism that led to the birth and early propagation of bitcoin. But, man, evolution rules for a reason, and bitcoin is evolving into something potentially really special and massive. And its time, in my opinion, for this early adopter mentality to be replaced with a new type of visionary. I am happy to ride that wave. |
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mccorvic
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October 28, 2013, 09:27:46 PM |
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Did Gox lead that mini-dump?
That's like asking "Does the dog lead the tail or does the tail just follow the dog?" |
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windjc
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October 28, 2013, 09:29:56 PM |
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Did Gox lead that mini-dump?
Why do you care? All you do is come up with the most off the wall conspiratorial speculation on how a small group of secret underground bitcion elite control all the markets to their advantage and the sufferage of the rest of us. At least when they are not doing their blood sacrifices, right? Or is it virgin burnings? I can't remember. |
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