[2018-09-04] Is the future of Bitcoin in ETF?

[BitForx]

https://blog.bitforx.com/wp-content/uploads/2018/09/39962157_736169490060434_3081254871530209280_n.jpg

Is the Future of Bitcoin in ETF?

We live in a blockchain technology development era. But even years after the creation of Bitcoin, we still blaze our trails like a mole. New technologies are always scary, but there’s no escaping them. The smart and practical way of dealing with changes is to adapt to them.

The crypto and blockchain world has a lot to offer us. Every day we come across new ideas and new approaches related to crypto. Some people thought that the invention of Bitcoin and Etherium was the best it could get. But today it’s all improving Bitcoin and Blockchain technologies. Almost every day, we hear about a new project idea, new ICO, or new technology working with blockchain. Almost every day we hear about an idea proposed to implement blockchain in a technology that has been around for a while. These ideas help to improve the infrastructure we have, our financial and banking systems.

One of the ideas I want to talk about today is implementing Bitcoin in ETF.

What is ETF?

ETF stands for Exchange Traded Fund. To put it simply, ETF is a security measure tracing an index, a commodity, bonds or a basket of assets. In other words, it’s a collection of different securities. ETF’s price depends on the index, commodity, or assets that it traces. Its’ price can vary through the day, as it is being sold and bought.

What’s the difference between ETF and a regular Futures and shares?

- ETF is a fund. It’s not just a singular share, it’s a portfolio of shares.It is being created by the professional members of the market.
- Investors don’t have to pay for the administration of a Portfolio.
- ETFs are high in liquidity.
- ETFs have lower fees than mutual fund shared

All this, and some more, serves to make ETF an attractive alternative for individual investors.

Some people say that a bitcoin ETF is practically the antithesis of what bitcoin’s main idea is supposed to be. Some people (mainly investors) hold their breaths to hear the news about Bitcoin ETF being approved. But meanwhile, we have only seen few denied Bitcoin ETFs and opinions from several Crypto experts.

What are the thoughts of experts on Bitcoin ETF?

Bitcoin ETF has gained popularity, because of the high expectations from the Crypto community. Legend says that Bitcoin ETF has the potential to attract a massive exposure of large capitals in the Crypto world.

Some say that history will repeat itself. We have seen how the Gold ETF has transformed the market and now we’re hoping to see Bitcoin do the same magic. Once ETF becomes available for a market, the price of a Commodity (in this case Bitcoin) rises up enormously. On  March 28, 2003, the first Gold ETF was launched and the interest in gold started rising. But the thing is, these markets are controlled and manipulated, that crosses out the idea of Bitcoin and the independence of our financial possibilities.

Many experts argue whether Bitcoin ETFs are a good idea or not. On  Aug 14, 2018, Andreas Antonopoulos published a Video about it on his Youtube Channel. In this video, he answers several questions regarding Bitcoin ETF and voices his opinion on the changes in the Bitcoin environment.

Andreas says in his video, that he thinks the Bitcoin ETF will be approved by the SEC (The U.S. Securities and Exchange Commission), but – according to him – it’s a terrible idea.

“The idea here is to take a reserve of Bitcoin and then make them tradable instruments that can be traded on markets like stocks,” says Andreas. But, in this situation “Custodial holds the actual Bitcoin in and what you’re getting is a share in their funds – not Bitcoin”. This way, traditional investors will be able to influence the price of Bitcoin. Andreas says that these markets are heavily manipulated and that Bitcoin ETF will damage its ecosystem.

“ETFs fundamentally violate the underlying principle of P2P money, where each user is not operating through a custodian, but has direct control of their money, because they have a direct control of their keys,” says Andreas. To summarize the whole video “Your keys? Your BTC! Not your keys? Not your BTC” this is what Andreas has to say about Bitcoin ETF.

Another opinion about Bitcoin ETF comes from the founder of Netcoin, Michael Vogel. He thinks that Bitcoin ETF is an interesting idea, but not crucial and obligatory for Bitcoin’s long-term success.

Experts and non-experts have been talking about it and there are several different opinions and different point of views. Some say that Bitcoin and the crypto markets do not need an ETF to be great. Agreeing on Andreas’ opinion, saying ETF to be an antithesis of Bitcoin’s original purpose. Like every coin has two sides, this matter has supporters and opposing sides. Stating that crypto really (really) wants a Bitcoin ETF, this article concentrates on the demand and adaptation of Bitcoin to ETF.

Now, it turns out that Bitcoin ETFs has many supporters. Some say that it’s how life works. “Adapt or die. Approve Bitcoin ETF and take the leading step for advancing the human race through the revolutionary technology we have been gifted” is one of the sought comments on the SEC for the latest effort to get an exchange-traded fund tied to bitcoin.

Alena Vranova, the founder of Trezor and business strategy advisor for crypto companies, also speaks about Bitcoin ETF with speculation, stating that Bitcoin ETF is definitely not a necessary tool for Bitcoin development. On the other hand, it could be a possibility to open the door of the Crypto world for so many new investors. She thinks that Bitcoin ETF predictions are a signal for holders. She states that implementing Bitcoin ETFs can help the price of BTC to become more stable and skyrocket in a very short time.

Mostly, experts agree that Bitcoin ETF is not necessary for Bitcoin’s future. Some of them talk about the negative side effects of Bitcoin ETF, some experts believe that ETF can actually save or benefit Bitcoin and its investors.

Vitalik Buterin, on the other hand, talks about how much emphasis is placed on Bitcoin ETF. On July 29, 2018, he posted a tweet, saying “I think there’s too much emphasis on BTC/ETH/whatever ETFs and not enough emphasis on making it easier for people to buy $5 to $100 in cryptocurrency via cards at corner stores. The former is better for pumping price, but the latter is much better for actual adoption”. I think that Vitalik is a Bitcoin ETF supporter, more or less. He thinks that ETF could help BTC balance the price (and grow it), plus, helping first-time investors and newbie crypto lovers to make small time investments.

In the end, all we can do is wait and see how things turn out. As several experts have pointed out, there’s probably no escaping from Bitcoin ETFs. Things are changing and they’re changing fast. What was an unimaginable technology a few years ago, today is the number one discussed subject. We see innovations every day and we hope they’ll be prosperous for us. It seems like the future holds a place for Bitcoin ETFs, all we have to do is to kick back, relax and wait for future events to occur.

Source: https://blog.bitforx.com/2018/09/04/future-of-bitcoin-etf/

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[jvdp]

I do not think that ETF is the only solution for bitcoin to grow more in future. SEC declined the bitcoin proposal many time still there is no any such positive information for the SEC team. We just ignore those things and go towards to good investment to make money out of it.

How do you believe the ETF is the only thing allow us to find the bump in future.
Since you simply shared news here from your site directly, I would like to see it more. Keep up your good work mate.

[BitForx]

I do not think that ETF is the only solution for bitcoin to grow more in future. SEC declined the bitcoin proposal many time still there is no any such positive information for the SEC team. We just ignore those things and go towards to good investment to make money out of it.

How do you believe the ETF is the only thing allow us to find the bump in future.
Since you simply shared news here from your site directly, I would like to see it more. Keep up your good work mate.

Thank you for your feedback. In our opinion, this is simply the Bitcoin infrastructure's way of growing. It needs to touch every field and every market until it finds the best suit. ETF may or may not be the best thing for Bitcoin, who knows?!

[Sutters Mill]

Bitcoin is bigger than these ETFs and bitcoin's future is so much more than just them. Don't get me wrong, I think ETFs are potentially huge for bitcoin and a big step in the right direction for mainstream acceptance and will surely open up doors to more investors and the general public which will obviously all come with financial benefit due to increased demand, but we certainly shouldn't pin all our hopes and dreams on them. What if they never actually get the go ahead? Maybe they will and maybe they won't, but they're certainty not the entire future of bitcoin that's for sure. Regardless, whether they do get accepted or not it is out of our hands so I think we should concern ourselves with spreading adoption in other ways in the meantime and we can only wait and hope they do get accepted at some point.

[rodskee]

Nope but big help for bitcoin if ETF approve by the government  
In my own opinion bitcoin continue to stay string as currency without ETF aproval
Bitcoin supposedly still strongly stand their own ability to become famous currency in the help of the supporters
I still believe The  future of bitcoin in this new era of technology are still continue to grow

[BitHodler]

Don't get me wrong, I think ETFs are potentially huge for bitcoin and a big step in the right direction for mainstream acceptance and will surely open up doors to more investors and the general public which will obviously all come with financial benefit due to increased demand, but we certainly shouldn't pin all our hopes and dreams on them. What if they never actually get the go ahead? Maybe they will and maybe they won't, but they're certainty not the entire future of bitcoin that's for sure.

An ETF approval is only a matter of time, really. The only point I don't agree with, is the fact that most people blindly assume that an ETF will have a significant impact on the market.

I don't see anyone here ever point out that there might not be much demand for an ETF at all. And then we don't know if the ETF that will be approved will be backed by Bitcoin or not, which is quite an important factor too.

If it's not backed by Bitcoin at all, there will be next to no actual effect on the spot market, even if the demand is significant enough to consider it a successful ETF launch. That's definitely something to keep in mind.

I don't want to sound all that negative, but there is no point to hype up something with no proven track record either. I want Bitcoin to succeed based on legit user demand, and we can definitely work towards that goal slowly but surely.

[Kakmakr]

The short-term benefit of a Bitcoin ETF will be a huge increase in the Bitcoin price, but in my opinion a Bitcoin ETF's long-term impact will be harmful to Bitcoin. We will see a lot more volatility, because much bigger players from Hedge funds will start to invest big amounts of money into these ETFs and they can pull it at any time. 

The manipulation of the price will go from current Bitcoin Whales to large Hedge funds in Wall Street. A lot of people are against this move, because these Wall Street investors have no long-term vision for Bitcoin, other than making a quick profit. 

[PumpkinDonat]

No, bitcoin was created as a currency, not for price manipulation. Trading tool is a second time for bitcoin, it will be develop, but it not the future.

[magneto]

Hell no. ETFs are only financial instruments which are beneficial to institutional investors and the like.

In no way shape or form are they of any use to the average Joe using bitcoin. The only effect would be the hype created by an approval (which seems extremely unlikely at this stage with SEC continuously rejecting and delaying decisions) which could potentially push prices up in the short term.

There is no long term future to speak of in bitcoin that is held in bitcoin ETFs, that is just stuff made up by media. The SEC is making a judgment on a financial product, not bitcoin itself, remember that.

[Sutters Mill]

Don't get me wrong, I think ETFs are potentially huge for bitcoin and a big step in the right direction for mainstream acceptance and will surely open up doors to more investors and the general public which will obviously all come with financial benefit due to increased demand, but we certainly shouldn't pin all our hopes and dreams on them. What if they never actually get the go ahead? Maybe they will and maybe they won't, but they're certainty not the entire future of bitcoin that's for sure.

An ETF approval is only a matter of time, really. The only point I don't agree with, is the fact that most people blindly assume that an ETF will have a significant impact on the market.

I don't see anyone here ever point out that there might not be much demand for an ETF at all. And then we don't know if the ETF that will be approved will be backed by Bitcoin or not, which is quite an important factor too.

If it's not backed by Bitcoin at all, there will be next to no actual effect on the spot market, even if the demand is significant enough to consider it a successful ETF launch. That's definitely something to keep in mind.

I don't want to sound all that negative, but there is no point to hype up something with no proven track record either. I want Bitcoin to succeed based on legit user demand, and we can definitely work towards that goal slowly but surely.

I'm not so sure it's only a matter of time. They might just think it is too risky and volatile to allow. Why haven't they accepted one already as there's been several requests and all have been denied so far. I hope this isn't the case and one will be accepted eventually but I wouldn't put all my money on it.

I also disagree with you in that I do think it will have a significant effect on bitcoin. We already saw a drop in value when a couple of them were denied before, and I think one finally being given the green light will be very exciting for people and cause increased demand and a price spike. It's probably not going to go to the moon again because of it and I don't think we'll see a new all time high or anything because of it but I think it will be very significant.

[BitHodler]

Why haven't they accepted one already as there's been several requests and all have been denied so far. I hope this isn't the case and one will be accepted eventually but I wouldn't put all my money on it.

Currently the main problem is that the majority of the market making happens on exchanges outside the legal reach of the SEC. In case of manipulation, they pretty much can't do anything to combat the bad actors.

If eventually US based volumes grow, and it's no longer unregulated exchanges dominating the whole industry, they'll be more likely to let one come through. From there I believe it's only a matter of time.

I also disagree with you in that I do think it will have a significant effect on bitcoin. We already saw a drop in value when a couple of them were denied before, and I think one finally being given the green light will be very exciting for people and cause increased demand and a price spike.

I don't rule out any initial speculative hype resulting in the price to increase. I was more referring to the actual demand for these ETFs as instrument, which in no shape or form is guaranteed to be of significance.

[BitForx]

Bitcoin is bigger than these ETFs and bitcoin's future is so much more than just them. Don't get me wrong, I think ETFs are potentially huge for bitcoin and a big step in the right direction for mainstream acceptance and will surely open up doors to more investors and the general public which will obviously all come with financial benefit due to increased demand, but we certainly shouldn't pin all our hopes and dreams on them. What if they never actually get the go ahead? Maybe they will and maybe they won't, but they're certainty not the entire future of bitcoin that's for sure. Regardless, whether they do get accepted or not it is out of our hands so I think we should concern ourselves with spreading adoption in other ways in the meantime and we can only wait and hope they do get accepted at some point.

I agree 100%. We try to keep the neutral way while discussing this subject, but lately Bitcoin ETF has been the number one subject for discussion. Considering everything that you said, what do you think? Will Bitcoin ETF be accepted 100%? (like Andreas says) or is it more doubtful?

[BitForx]

Nope but big help for bitcoin if ETF approve by the government  
In my own opinion bitcoin continue to stay string as currency without ETF aproval
Bitcoin supposedly still strongly stand their own ability to become famous currency in the help of the supporters
I still believe The  future of bitcoin in this new era of technology are still continue to grow

So, as I understand, you don't believe that Bitcoin ETF will be accepted?

By the way, of course Bitcoin doesn't need ETF to be popular and useful. It's the first cryptocurrency and it's popular enough already. I can see many different ways it can be developed, and ETF is one of them. It's a subject of conversation whether it's a good idea or not, but I'm interested in what you think?

[BitForx]

No, bitcoin was created as a currency, not for price manipulation. Trading tool is a second time for bitcoin, it will be develop, but it not the future.

Yes, Bitcoin was created as a currency, but many markets have opened the doors for Bitcoin. The crypto infrastructure is still forming and people are trying out different fields that Bitcoin can affect. One of those field is ETF. It's not necessarily the best thing to happen to Bitcoin, but it's something that people think should be tried. You can't deny that Bitcoin ETFs have big demand. It's different if Bitcoin needs ETF or not (I think it doesn't need ETF to be great, but it's something that will probably happen).

[BitForx]

Hell no. ETFs are only financial instruments which are beneficial to institutional investors and the like.

In no way shape or form are they of any use to the average Joe using bitcoin. The only effect would be the hype created by an approval (which seems extremely unlikely at this stage with SEC continuously rejecting and delaying decisions) which could potentially push prices up in the short term.

There is no long term future to speak of in bitcoin that is held in bitcoin ETFs, that is just stuff made up by media. The SEC is making a judgment on a financial product, not bitcoin itself, remember that.

Don't you think that people often think about Bitcoin as an investment and not a currency? I have seen many people (hodlers mostly) who believe that cryptocurrency is for an investment, they hope for the future rise and profit. But originally, Bitcoin was created as a currency, as an everyday use tool. By looking at this situation, I think lots of people will be excited to have Bitcoin ETFs, just for the investment plans.

I know it's an arguable subject, whether it's necessary for Bitcoin to have an ETF or not, but this thing is demanded all over the world. Changing or maybe transforming the Bitcoin infrastructure.

It's nice to know your opinion about this.

[1Referee]

Don't you think that people often think about Bitcoin as an investment and not a currency?

That's okay I guess, as long as the balance is healthy enough.

In all cases, the majority of the fiat in circulation isn't being utilized as money, but rather as investment. The reason fiat has value is because we need and use it as money, and we need it to invest in other assets. It's a 2-way utility factor that makes fiat so useful, even though its value depreciates consistently throughout the years.

Bitcoin does everything fiat does in that regard, except for the fact that with Bitcoin you aren't dealing with long term value depreciation.

The current generation of "investors" are lunatics and parasites that we'll eventually get rid of. Smart money will shake the last few satoshis out of their pockets.

[Slow death]

I think lots of people will be excited to have Bitcoin ETFs, just for the investment plans.

people are very enthusiastic because they expect to have a big increase in prices, just look at this:

Bitcoin ETF Exclusive: Trump Appoints Pro-Crypto SEC Commissioner While Coinbase Planning a Bitcoin ETF

with this we increase more the chances of finally seeing a bitcoin ETF, the next months will be very exciting months

Bitcoin does everything fiat does in that regard

But few countries use bitcoin to pay their bills and make purchases. after the mastercard and visa have become a bitcoin enemy, we do not have the means to use bitcoin as a form of payments. If we had bitcoin debit card, then we would be using bitcoin like fiat

[timerland]

On  March 28, 2003, the first Gold ETF was launched and the interest in gold started rising. But the thing is, these markets are controlled and manipulated, that crosses out the idea of Bitcoin and the independence of our financial possibilities.

These are the obvious negative effects of ETFs. They might produce a short term spark in the market, but after that, it could actually lead to more manipulation within the market due to the fact that they are only financial instruments, and not actual bitcoins itself.

In my opinion, there is absolutely no way that the future of bitcoin is in the ETF alone, at least not in a positive sense. Regardless of whether the ETF is approved, the bitcoin network is going to stay the same.

People need to start to realizing that adoption levels is what's going to affect the future of bitcoin, especially international adoption by people who produce and sell goods. That's what makes bitcoin a better currency, in my opinion at least. ETFs could fulfill the void of institutional investors, but most likely is not going to be of benefit to bitcoin in the long run.

Besides, it's not like there is much of a chance that one ETF is going to get accepted next month. In fact, we don't even know if September is truly going to be the absolute deadline for ETFs which are on review right now.

[1Referee]

But few countries use bitcoin to pay their bills and make purchases. after the mastercard and visa have become a bitcoin enemy, we do not have the means to use bitcoin as a form of payments.

It's just a matter of time before we can start even paying our bills in Bitcoin. Merchants can save like 3% in fees just by accepting Bitcoin, which allows them to forward that as a bonus to people using Bitcoin as payment option. If Merchants cut out the centralized payment gateways, which will take a while but still, Mastercard & Co won't be able to compete with Bitcoin based on fees anymore.

If we had bitcoin debit card, then we would be using bitcoin like fiat

That's not Bitcoin. We need to get rid of central parties requiring permission and fees for their services. That's what Bitcoin is meant to combat. If we stick to debit cards and central payment gateways, what are we using Bitcoin for? People in that case can just as easily stick to using fiat as they have always been doing.

[Coin-1]

I guess that Bitcoin ETF will be adopted in the future. As far as I know, the SEC twice rejected the ETF proposals - in 2017 and recently in August 2018. I'm pretty sure that the Winklewoss brothers or other big BTC holders will file a new application next year. Who knows whether this proposal will be refused or not. Perhaps there will be another circumstances for changing the opinion of the SEC.

[Sutters Mill]

Hell no. ETFs are only financial instruments which are beneficial to institutional investors and the like.

In no way shape or form are they of any use to the average Joe using bitcoin. The only effect would be the hype created by an approval (which seems extremely unlikely at this stage with SEC continuously rejecting and delaying decisions) which could potentially push prices up in the short term.

There is no long term future to speak of in bitcoin that is held in bitcoin ETFs, that is just stuff made up by media. The SEC is making a judgment on a financial product, not bitcoin itself, remember that.

Don't you think that people often think about Bitcoin as an investment and not a currency? I have seen many people (hodlers mostly) who believe that cryptocurrency is for an investment, they hope for the future rise and profit. But originally, Bitcoin was created as a currency, as an everyday use tool. By looking at this situation, I think lots of people will be excited to have Bitcoin ETFs, just for the investment plans.

I know it's an arguable subject, whether it's necessary for Bitcoin to have an ETF or not, but this thing is demanded all over the world. Changing or maybe transforming the Bitcoin infrastructure.

It's nice to know your opinion about this.

We can't stop people from using it how they want, but there's no reason why it can't be both a currency and investment. Saving money should give you interest over time and that's how bitcoin is designed so the less comes into existence as time goes by, as opposed to fiat where more and more gets printed which devalues everybody else cash. If you want to use your bitcoins for payment for goods and services then you can, but those that want to hold it as a (potential) investment can also do so.

[BitForx]

Don't you think that people often think about Bitcoin as an investment and not a currency?

That's okay I guess, as long as the balance is healthy enough.

In all cases, the majority of the fiat in circulation isn't being utilized as money, but rather as investment. The reason fiat has value is because we need and use it as money, and we need it to invest in other assets. It's a 2-way utility factor that makes fiat so useful, even though its value depreciates consistently throughout the years.

Bitcoin does everything fiat does in that regard, except for the fact that with Bitcoin you aren't dealing with long term value depreciation.

The current generation of "investors" are lunatics and parasites that we'll eventually get rid of. Smart money will shake the last few satoshis out of their pockets.

Haha, I like your observation and predictions about current "investors". There's only one thing I want you to ask now, do you think that Bitcoin and cryptocurrencies will outlive fiat and eventually replace all the currencies and we'll use cryptocurrencies in everyday financial activities? And if so, why?