Is a Bitcoin ETF Finally In Sight?

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2017 saw a lot of hype around crypto such as bitcoin being traded on the stock market. That resulted in serious hype of a Bitcoin ETF which we still haven't seen to this day. However 2021 might very well be the year.

While we have seen Bitcoin related stocks in the market an ETF has yet to show it's face.

We have Stock that mine bitcoin and are solely traded on that as a company. These types of stocks are totally reliant on the price of bitcoin but also the amount of hashing they can do.

Riot Blockchain NASDAQ: ROIT
Marathon Patent Group NASDAQ: MARA
Canaan NASDAQ: CAN
HIVE Blockchain Technologies OTC: HVBTF

This might not seem like a big thing but it actually is. It's allowed trading via stocks to in some part trade bitcoin on the open market.

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What would a Bitcoin ETF be like?

An ETF is a part of ETP or Exchange-traded products. What they do is closely watch whatever product they are related to and mirror that price. If for example bitcoins price goes up this ETF would go up. There currently is one in operation but on the Stockholm stock exchange listed as Bitcoin Tracker EUR of $1.7 billion in worth.

Another with restrictions is Grayscale Bitcoin Trust GBTC which physically holds the bitcoin.

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Why we need a ETF...

Let's face it people love easy and for anyone new to crypto it's actually hard and difficult to understand and there's common mistakes people make which put their crypto assets at risk such as creating a wallet, managing the wallet, losing your keys, trading for bitcoin etc.

A ETF would remove all of this process and allow people to use their 401k's and other investments easily. However they do need to be accredited investors and their funds would be locked up.

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Why there's so much headwind from governments

The main issue is regulation and governments worried they wont get their cut. Such as proving ownership of the bitcoin and the threat of hacking.

Every day bitcoin wallets are being hacked my other governments. Mainly North Korea and most likely China that continues to take battles of war into cyber space.

There is always a human factor in cryptocurrency which means there's room for error such as storing your keys on your hard drive in a notepad file. A hacker could access your system and pull this information off and now they have your keys. Uploading info to the cloud. Even Microsoft one drive backup is by default on and backing up everything from your PC. Your keys if saved in this way such as a PDF would also be on the cloud right now.

Will we see a ETF?

Most likely yes, however I believe better options will start to open up before this happens. It's easy enough now to go buy bitcoin with some effort but for those lazy an ETF could be a good option.

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Posted Using LeoFinance Beta



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2 comments
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Dangerous prospect as we are taking away the individuality of holding crypto. But on the flip side, great for gaining more traction in adoption!

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