Winklevoss Bitcoin Trust on Bloomberg

[David Rabahy]

There's no need to wait; SecondMarket can get IRA into Bitcoin through partners now.

really?  link?

https://www.secondmarket.com/ *but* I haven't actually transacted with them yet; I'll report how it goes.  All I have done so far is just signed up and exchanged a couple of emails.  The partner they are connecting me with is Equity Institutional http://www.equityinstitutional.com/ (formerly Sterling Trust whom I contacted a while ago but at least at that time they weren't touching Bitcoin yet).

[adamstgBit]

There's no need to wait; SecondMarket can get IRA into Bitcoin through partners now.

really?  link?

https://www.secondmarket.com/ *but* I haven't actually transacted with them yet; I'll report how it goes.  All I have done so far is just signed up and exchanged a couple of emails.  The partner they are connecting me with is Equity Institutional http://www.equityinstitutional.com/ (formerly Sterling Trust whom I contacted a while ago but at least at that time they weren't touching Bitcoin yet).

secondmarket is only open to rich people tho. Winklevoss Bitcoin Trust  would be open to all.

what is this equityinstitutional.com

i thought secondmarket.com was going to handle the bitcoins on their own.

[Keyser Soze]

This ETF, if approved, will be the thing that takes bitcoin to the next level.

It's amazing how many people here don't get that. They don't like the Winklevoss twins because they saw that movie and think they are money-grubbing assholes. But they Winklevoss twins are smart and they get it.

This ETF will take bitcoin's value from the hundreds to the thousands overnight. Possibly even tens of thousands.

For most of us, buying the real thing directly is better that buying shares in an ETF.

But this opens up bitcoin to everyone who isn't sophisticated enough or doesn't have the time to go through all the steps to open up an account on a exchange, wire money to a foreign country, and manage their own wallet.

This lets your grandmother invest in bitcoin.

My mother has been reading about bitcoin in the news and she has repeatedly asked how she can buy some. I basically just tell her that I will sell her some when I see her at Thanksgiving. Her friends have been e-mailing me too, asking if they should invest in bitcoin and how they can buy them.

This ETF would let them invest much more easily than it is now and even more importantly it would allow the trillions in retirement fund accounts to invest in bitcoin!

As someone said earlier, most American families do not have the liquid cash to go out and buy bitcoins. But many of them do have 401ks and IRAs which could invest in this ETF.

The price should also stabilize a bit as the size of the market grows a couple of orders of magnitude. Bitcoin will also be finally seen as legitimate to institutional investors and that should help it stabilize too.

This ETF is a wonderful thing for bitcoin.

This.

I know the moment this is approved (assuming it will be) I will be getting some in my 401k.

[David Rabahy]

secondmarket is only open to rich people tho. Winklevoss Bitcoin Trust  would be open to all.

what is this equityinstitutional.com

i thought secondmarket.com was going to handle the bitcoins on their own.

Plenty of folks are rich enough *if* they include their retirement funds.  As an alternative, paying the penalty and taxes to withdraw retirement funds prematurely is a pretty painful way to get into Bitcoin but with the kind of potential it could very well be worth it -- one does not need to be rich enough to use this approach just committed/brave.

I left a voice message with the Equity Institutional person directly and an awaiting a callback.  They are a trust company.  They can hold things, e.g. Bitcoins, in trust for folks.

SecondMarket is apparently partnering with Equity Institutional (and others) to connect Bitcoin investors with trust companies.  I'm sure SecondMarket will want a fee for making this connection but pretty quickly folks will find their own way to the trust companies.

[David Rabahy]

Absolutely - its 10% penalty and about 30% taxes upfront,

You do know you can borrow against your 401k up to 50% or $50k, at about 5% interest and pay most of the interest back to yourself.

Yes, I do know; in fact, I borrowed against my 401k a couple of months ago but each payment back into $US denominate funds goes against the Bitcoin grain.

[David Rabahy]

secondmarket is only open to rich people tho. Winklevoss Bitcoin Trust  would be open to all.

what is this equityinstitutional.com

i thought secondmarket.com was going to handle the bitcoins on their own.

Plenty of folks are rich enough *if* they include their retirement funds.  As an alternative, paying the penalty and taxes to withdraw retirement funds prematurely is a pretty painful way to get into Bitcoin but with the kind of potential it could very well be worth it -- one does not need to be rich enough to use this approach just committed/brave.

I left a voice message with the Equity Institutional person directly and an awaiting a callback.  They are a trust company.  They can hold things, e.g. Bitcoins, in trust for folks.

SecondMarket is apparently partnering with Equity Institutional (and others) to connect Bitcoin investors with trust companies.  I'm sure SecondMarket will want a fee for making this connection but pretty quickly folks will find their own way to the trust companies.

SecondMarket is sticking to their $25K (USD) minimum.  They rejected my request to bring in just ~$14K (USD) at first.  They also insist on documentation showing one is an Accredited Investor, i.e. net worth excluding main residence >$1M (USD).  Even if I can make both hurdles do I want to pay their 1.5% front end, 2% annual and 1.5% back end fees besides the additional fees the trust company charges for their services?  The SecondMarket unit investment trust (UIT), Bitcoin Investment Trust http://www.bitcointrust.co/ (with a suspicious Columbian domain), will be something less than 100% Bitcoin (obviously they will have to have some cash on hand).  Finally, they indicate they will liquid by March 2014 (at that point allowing folks to get out) but how can we be sure?

[rocks]

The ETF will add liquidity and will allow people to invest the capital necessary to get things like migrant worker payment systems in place and hopefully a true merchant processing competitor.
It will also allow people to short bitcoin in a large way which will be really interesting.  When you trade commodities there are differences between physical and financial.   Many times the financial delivery exceeds the actual physical delivery capacity.
ie.   If someone had short sold to me millions of barrels of oil for march delivery, I can demand physical delivery at cushing.   If I do not trade out of it in the three days before expiration, I can schedule with the seller when he must deliver.   This gives you spikes in the spot market sometimes but generally people can settle on the financial contract.     
Now think this about this.   If some smart guys said "bitcoin is BS, let's bust it" (you know kind of like Soros did to the pound) and they shorted TONS of bitcoin, how would they deliver if a large group of miners/hoarders refused to sell their stored coins.   What would happen to the spot market in bitcoin?  Because the great thing about ETFs (and later futures) is that people can financially sell more than the entire market size.   But with bitcoin, you cannot deliver what is not there.   Those are the days I look forward too, when the shorts get squeezed for the first few times because they are used to shorting other "commodities/currencies" that they can always hedge out of.

Yes this, Bitcoin is such a different asset in that it is so easy to demand 'physical' payment against the shorts.

With oil or gold you have to understand the delivery mechanisms cover fees, etc. With a bitcoin ETF you would simply provide your payment address for delivery, the barrier for participation is much lower. Most ETFs (such as GLD) function where approved liquidity providers are able to buy or sell x amount of the underlying assest into the ETF, this keeps the ETF tracking the underlying asset. With a Bitcoin ETF liquidity providers would buy or sell fixed blocks of BTC in and out.

In this situation a short squeeze is so much more likely and something typical bankers / traders could be caught by.

[User705]

Have you asked them if they already have the coins backing this and if yes are they willing to give you the public address for them.

[Minor Miner]

Have you asked them if they already have the coins backing this and if yes are they willing to give you the public address for them.

most of these do not hold the underlying but use futures hedging to try and match the return (read up the bear 3x spy and such).   This is why I think this could be very interesting.

[User705]

Have you asked them if they already have the coins backing this and if yes are they willing to give you the public address for them.

most of these do not hold the underlying but use futures hedging to try and match the return (read up the bear 3x spy and such).   This is why I think this could be very interesting.

What futures?  There are no bitcoin futures that I know of.

[Minor Miner]

Have you asked them if they already have the coins backing this and if yes are they willing to give you the public address for them.

most of these do not hold the underlying but use futures hedging to try and match the return (read up the bear 3x spy and such).   This is why I think this could be very interesting.

What futures?  There are no bitcoin futures that I know of.

Exactly.

[rocks]

Have you asked them if they already have the coins backing this and if yes are they willing to give you the public address for them.

most of these do not hold the underlying but use futures hedging to try and match the return (read up the bear 3x spy and such).   This is why I think this could be very interesting.

What futures?  There are no bitcoin futures that I know of.

Exactly.

Don't worry, it won't take long for them to try to create futures. Only this time there won't be a FED to bail out poor decisions...

[Corelianer]

The ETF will add liquidity and will allow people to invest the capital necessary to get things like migrant worker payment systems in place and hopefully a true merchant processing competitor.
It will also allow people to short bitcoin in a large way which will be really interesting.  When you trade commodities there are differences between physical and financial.   Many times the financial delivery exceeds the actual physical delivery capacity.
ie.   If someone had short sold to me millions of barrels of oil for march delivery, I can demand physical delivery at cushing.   If I do not trade out of it in the three days before expiration, I can schedule with the seller when he must deliver.   This gives you spikes in the spot market sometimes but generally people can settle on the financial contract.    
Now think this about this.   If some smart guys said "bitcoin is BS, let's bust it" (you know kind of like Soros did to the pound) and they shorted TONS of bitcoin, how would they deliver if a large group of miners/hoarders refused to sell their stored coins.   What would happen to the spot market in bitcoin?  Because the great thing about ETFs (and later futures) is that people can financially sell more than the entire market size.   But with bitcoin, you cannot deliver what is not there.   Those are the days I look forward too, when the shorts get squeezed for the first few times because they are used to shorting other "commodities/currencies" that they can always hedge out of.

You are right, but with the ETF it's easier to go short on Bitcoins.
And if 1% of all Bitcoins are sold on the market, then you know what's going to happen?
They only need the miners coins if they want to go short on more than 1%. But 1% can be enought to ruin the price.

There are probably a bunch of banks that have more money than everyone of us that have then easier access with the ETF's to destroy Bitcoin, if they want to...

[davidgdg]

Have you asked them if they already have the coins backing this and if yes are they willing to give you the public address for them.

most of these do not hold the underlying but use futures hedging to try and match the return (read up the bear 3x spy and such).   This is why I think this could be very interesting.

What futures?  There are no bitcoin futures that I know of.

http://www.plus500.co.uk/Instruments/BTCUSD

[BitchicksHusband]

The ETF will add liquidity and will allow people to invest the capital necessary to get things like migrant worker payment systems in place and hopefully a true merchant processing competitor.
It will also allow people to short bitcoin in a large way which will be really interesting.  When you trade commodities there are differences between physical and financial.   Many times the financial delivery exceeds the actual physical delivery capacity.
ie.   If someone had short sold to me millions of barrels of oil for march delivery, I can demand physical delivery at cushing.   If I do not trade out of it in the three days before expiration, I can schedule with the seller when he must deliver.   This gives you spikes in the spot market sometimes but generally people can settle on the financial contract.    
Now think this about this.   If some smart guys said "bitcoin is BS, let's bust it" (you know kind of like Soros did to the pound) and they shorted TONS of bitcoin, how would they deliver if a large group of miners/hoarders refused to sell their stored coins.   What would happen to the spot market in bitcoin?  Because the great thing about ETFs (and later futures) is that people can financially sell more than the entire market size.   But with bitcoin, you cannot deliver what is not there.   Those are the days I look forward too, when the shorts get squeezed for the first few times because they are used to shorting other "commodities/currencies" that they can always hedge out of.

You are right, but with the ETF it's easier to go short on Bitcoins.
And if 1% of all Bitcoins are sold on the market, then you know what's going to happen?
They only need the miners coins if they want to go short on more than 1%. But 1% can be enought to ruin the price.

There are probably a bunch of banks that have more money than everyone of us that have then easier access with the ETF's to destroy Bitcoin, if they want to...

For the education of the less informed, how would they destroy Bitcoin, step-by-step?  (And what could we do to protect ourselves?)

[BitcoinAshley]

If the banks try that, they're going to get royally fucked, and they know it.

[darkmule]

Since all the methods of "destroying" Bitcoin not only wouldn't work, but would in fact amount to torching a huge pile of money, I don't see this.  What would they get out of it?  Would they do it just for the pure evil of it while twirling a black mustache and cackling insanely?

[culexevilman]

prepare for a rally...

[chriswilmer]

this is a good thing for btc, it will not hurt btc...

id not invest in this as it is not holding btc and well if you dont hold it you dont own it. but im going to tell my grandma to get in...

i bet they sell out in hours... and thus have to refill right away..  you know the press on this will be massive...

Anyone know when it will go on sale?

BTW, you actually might want to invest in this even if you are a tech-saavy bitcoin holder. If you are in the US (but this applies to other countries too), your employer might match your retirement investment contributions (and there are tax advantages as well), but until the Winklevoss trust thing, you couldn't use that money on anything bitcoin related. Now you can have bitcoins in your retirement portfolio (with your employer doubling up your investment)!

[Keyser Soze]

Anyone know when it will go on sale?

They have filed documents, but they still require approval. Could easily take 6+ months.