2020-12-30 Coindesk - VanEck Proposes ETF for Bitcoin, Once Again

[cr1776]

VanEck Proposes ETF for Bitcoin, Once Again
As 2020 draws to a close, one of the prior proponents for an exchange traded fund (ETF) based on Bitcoin is trying again: VanEck has submitted an application to the U.S. Securities and Exchange Commission (SEC) for the “VanEck Bitcoin Trust.”

An ETF is seen as advantageous because it trades on the stock market much like shares in popular companies like Apple and Microsoft do.

VanEck has previously proposed ETFs before, withdrawing its most recent application in September 2019. At the time the company said it remained committed to an exchange traded product.

https://www.coindesk.com/vaneck-proposes-bitcoin-etf-again


Eventually the statists will approve an ETF.  It is just a question of when.  Will this time be different?  Who knows.  Will it be a positive for the bitcoin fiat price?  Opinions seem to vary, but my view is that the more options for people to use bitcoin, in this case for capital protection/capital appreciation, the better.

[figmentofmyass]

Eventually the statists will approve an ETF.  It is just a question of when.  Will this time be different?  Who knows.  Will it be a positive for the bitcoin fiat price?  Opinions seem to vary, but my view is that the more options for people to use bitcoin, in this case for capital protection/capital appreciation, the better.

how could it possibly be a negative for price? similar to GBTC, the ETF trust will need to accumulate coins from the spot market to back shares---bullish. institutional investors and retail investors alike will also have much easier (and in their minds, "safer" because regulation) access to the market---bullish. there are no doubt prospective investors who are still on the sidelines for fear of touching unregulated markets and unfamiliar exchanges. they're dinosaurs and they want liquid, regulated markets accessible through their preferred broker, and they also want assets they can easily hold in their mainstream retirement portfolios. that's a big market just waiting to be tapped.

here's my concern with where things are headed. coinbase is taking custody of like half of all new institutional investment. and they just bought xapo too, and surely there will be even more consolidation of the industry in the future. 5 or 10 years down the road, is coinbase just gonna have custody of like 5 million coins or something? more?

that just seems kinda scary to me.

[cr1776]

Eventually the statists will approve an ETF.  It is just a question of when.  Will this time be different?  Who knows.  Will it be a positive for the bitcoin fiat price?  Opinions seem to vary, but my view is that the more options for people to use bitcoin, in this case for capital protection/capital appreciation, the better.

how could it possibly be a negative for price? similar to GBTC, the ETF trust will need to accumulate coins from the spot market to back shares---bullish. institutional investors and retail investors alike will also have much easier (and in their minds, "safer" because regulation) access to the market---bullish. there are no doubt prospective investors who are still on the sidelines for fear of touching unregulated markets and unfamiliar exchanges. they're dinosaurs and they want liquid, regulated markets accessible through their preferred broker, and they also want assets they can easily hold in their mainstream retirement portfolios. that's a big market just waiting to be tapped.

here's my concern with where things are headed. coinbase is taking custody of like half of all new institutional investment. and they just bought xapo too, and surely there will be even more consolidation of the industry in the future. 5 or 10 years down the road, is coinbase just gonna have custody of like 5 million coins or something? more?

that just seems kinda scary to me.

I don't know how it could be negative but I've seen some people be anti ETF. 

I agree about the centralization being a problem.  One would hope that perhaps people would keep custody of their own coins, but one never knows.

[acquafredda]

Can you imagine what responsibility will those wallet managers have? Of course there are many people sharing the task but if I was working at coinbase with a huge burden on my fingers basically controlling the keys of, let's say, 20000+ btc..... my nights would be quite full of nightmares.
This whole custody value chain have some big weakest links - key managers!

[Lucius]

For those who may have forgotten the whole ETF process, it is a lengthy process that if I remember correctly can take up to a total of 240 days and the SEC makes its decision three times (with the third time being the final decision). Therefore, if anyone wants to test the SEC on this issue at all, the only way is to apply and prepare for an 8 - month process (unless, of course, the SEC approves it at the first statement).

Also, if memory serves me well, VanEck is the only one to offer a physical BTC ETF where they will actually buy coins on the basis of which they will issue shares. I’m not sure if that’s the case now, but VanEck is probably sticking to his original idea

Can you imagine what responsibility will those wallet managers have?

Coinbase showed publicly a few years ago how they act when generating private keys, and I have to admit it’s a very professional approach to business. They also claim that 98% of coins are in cold wallets, so they should be resistant to hacking - but we can never rule out the human factor, although I am sure that the mechanism for accessing these funds is complicated and depends on a larger number of people.

5 or 10 years down the road, is coinbase just gonna have custody of like 5 million coins or something? more?
that just seems kinda scary to me.

It should scare anyone who understands what Bitcoin should be, and it’s certainly not centralization in this direction. Even if we completely rule out the possibility of hacking and a human factor that would involve some inside job, so much BTC under the management of one company in a country that will never allow its national currency to be endangered in any way, is in my opinion a much greater danger and risk.

[Sithara007]

From the post from Lucius, it is clear that any new proposal for the ETF is going to take many months (if not years) to get finalized. And after putting in so much time and effort, there is no guarantee that the SEC would approve it. But it is funny to see the SEC putting so many regulations and restrictions on anyone attempting to start a Bitcoin ETF, while PayPal had it relatively easy when they integrated Bitcoin to their platform.

[rdbase]

I don't know how it could be negative but I've seen some people be anti ETF. 

I agree about the centralization being a problem.  One would hope that perhaps people would keep custody of their own coins, but one never knows.

They only have a negative effect on bitcoin's price when they fail to be approved as it had been for the last time(s) they have attempted to get it passed by the US senate last summer and the year before that.

From the post from Lucius, it is clear that any new proposal for the ETF is going to take many months (if not years) to get finalized. And after putting in so much time and effort, there is no guarantee that the SEC would approve it. But it is funny to see the SEC putting so many regulations and restrictions on anyone attempting to start a Bitcoin ETF, while PayPal had it relatively easy when they integrated Bitcoin to their platform.

Yeah only because paypal has the crypto stored in their own wallets and at the beginning they didn't allow you to send out your bitcoin to an external wallet. So whatever you bought from them, stayed in these custodial wallets located at paypal.
I don't know if this has changed since they first launched this option on their platform; being able to buy crypto from them, but this feature was a major subject which upset those who first purchased their bitcoin only to find out later on they couldn't do anything with it.