TL; DR
-
Here are three common arguments against a spot Bitcoin ETF:
-
1. It puts a whole bunch of Bitcoin under the care of a very small number of people, giving them control over it.
-
2. Some Bitcoin maximalists fear that the government will try to ban individual ownership of BTC, forcing investors to buy it only through an ETF.
-
3. Some people point to the idea that an ETF approval is already priced into Bitcoin.
Full story
There’s a lot of excitement surrounding a potential Bitcoin ETF (aka a way to buy Bitcoin on the stock market)…
But what are the potential downside risks?
We’ve found some common talking points from dissenting voices and compiled them here for you so you can form a balanced opinion (if you feel like doing so).
Here are three common arguments against a spot Bitcoin ETF:
-
It puts a whole bunch of Bitcoin under the care of a very small number of people, giving them control over it.
Sure, a wide range of people will buy these Bitcoin ETFs, but they will own the Bitcoin by proxy, meaning it will be the fund that actually manages the Bitcoin.
Our two cents: third-party secure custody should become an option if Bitcoin is going to spread. Not everyone will feel comfortable holding millions/billions of dollars on a hardware wallet.
-
Some Bitcoin maximalists fear that the government will try to ban individual ownership of BTC, forcing investors to buy it only through an ETF.
Our two cents: It feels like a challenge, but crazier things have happened.
-
Some people point to the idea that an ETF approval is already priced into Bitcoin.
This means that if/when an ETF is approved and goes live, the price won’t change that much – meaning we’re all getting excited about nothing.
Our two cents: In the short term, this is probably true. In the long term (12 months +) not so much.
All things considered, we’re still excited about the potential of a spot Bitcoin ETF.