TL;DR
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Bitcoin spot ETFs do not yet exist in the US And it’s not for lack of trying – Gemini and Grayscale have both tried to get blockchain ETFs approved.
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Now rumor has it that BlackRock, a company with $9.5 TRILLION under management, is trying to launch a US Bitcoin ETF.
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If you are a Bitcoin holder, this is a big problem! Even an allocation of 1-2% of BlackRock’s total funds can have a HUGE impact on BTC price.
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That said, a 1-2% allocation would also result in BlackRock owning ~20% of all existing Bitcoin, at current prices. (This allows BlackRock to hoard all available coins).
Full story
Have you ever befriended someone who owns a boat?
It is awesome! You enjoy all the benefits of owning it, without management and maintenance.
That’s pretty much how Exchange Traded Funds (ETFs) work.
The fund buys a number of ‘things’ – let’s say Bitcoin – after which investors can buy shares in the fund.
(So in the end they own Bitcoin by proxy).
The advantage is that the ETF shareholders don’t have to figure out how/where/when to buy/sell/store the Bitcoin.
(The fund managers do all that for them).
The only problem with this example is:
This kind of Bitcoin ETF does not exist in the US.
And it’s not for lack of trying – Gemini and Grayscale have both tried to get blockchain ETFs approved by the SEC, but neither have found success.
Now rumor has it that BlackRock, a company with $9.5 TRILLION under management, is trying to launch a US Bitcoin ETF.
…okay, who cares?
If you are a Bitcoin holder, this is a big problem!
Even an allocation of 1-2% of BlackRock’s total funds can have a HUGE impact on BTC price.
…that said, a 1-2% allocation would also result in BlackRock owning ~20% of all Bitcoin in existence, at current prices.
The advantage: Bitcoin could rise significantly. The disadvantage: Bitcoin could rise significantly, and most people would no longer be worth owning a meaningful amount of BTC.
(This allows BlackRock to hoard all available coins and more or less own the market).
Anyway, a BTC spot ETF in the US would be great news for Bitcoin!