Topic: How many Bitcoin do you think Wall St will own - page 2. (Read 423 times)

It is possible, indeed

But you are looking at it without taking into consideration the difference between gold and Bitcoin. Fractional reserve is possible with gold (as well as everything else) because there is no definitive way to check whether gold certificates (I intentionally avoid using the term paper gold here) are (not) backed up by gold (think of it as exploiting the benefit of doubt). This is not the case with Bitcoin, and that's the point which you seem to deliberately ignore as it is not the first time I point it out

If they bought in October 2017 and they are not sold in December 2017-January 2018, then I think right now, they are loss big money because now bitcoin price is down too deep. And if they still have bitcoin, they must hold tight the bitcoin until the price can increase more than $15k so they can sell and get those profit. I don't know how much bitcoin Wall Street have because we don't know if they get involved in bitcoin too or not. But I think they are right now using this chance to buy as much bitcoin as they can.

I doubt they own very much yet. I'm sure a very small number of institutions own a small amount of bitcoin, but I'd say its like 1% of what they might end up buying in the next couple of years.

Yeah, they own a lot and I think they started to adopt early that year, and for sure they invest more during the dumped moment of cryptomarket. Well, they will create money if they continue to support bitcoin. It looks like they are serious on this one, let's see their plan later on.

you're just reading from their PR material.

they can make money playing it straight. they can make a lot more money using fractional reserve, and they can do it legally too.

why do you guys think that's so impossible? why would you assume legacy institutions like ICE have the best of intentions and want to give away potential profits? just because "they believe in bitcoin"? lol, i'm not that gullible.

BAKKT put lots of emphasis in their announcements on not explicitly allowing leverage, but they carefully avoided questions about commingling and rehypothecation. people have been pleading with both them and regulators to address bitcoin rehypothecation but BAKKT has been completely silent on the issue. why do you think that is?

BAKKT has said they want to spread the *USAGE* of bitcoin and help it become a globally adopted currency. So despite what you say, it seems there primary interest is in helping bitcoin (not fake paper bitcoin bets) become adopted - and of course make money off the proliferation of bitcoin by getting in as one of the very first sources of bitcoin investments on wall st.

They will earn much less than they will negotiate.

They will probably Fractional reserve banking with bitcoin

right, which is how gold certificates work.

BAKKT has absolutely not said they won't engage in rehypothecation practices, which means applying fractional reserve practices to underlying borrowed collateral. of course they will---that's how central counterparties (like BAKKT) make their money.

this is how all wall street markets work. why would it be any different for bitcoin?


cash settled markets deliver USD at settlement time. under no circumstances could an investor treat them as bitcoins because after maturity, these contracts have no relationship to bitcoin at all. if you ever want real bitcoins, you could never accumulate them from these markets.

paper bitcoin markets allow settlement/conversion to bitcoin, meaning investors will treat them like bitcoins. this is much like how traders treat USDT like USD all the while wondering if the USDT is truly backed. we should assume not all paper bitcoins are truly backed because wall street openly and legally engages in collateral rehypothecation: a single underlying bitcoin can be pledged to several different borrowers as paper bitcoins. this is fully legal and it's likely part of BAKKT's business model.

Wall street isn't one entity. I'm sure that there is a wide variety of institutions owning a decent number of Bitcoin, but it's all relative with how it very likely doesn't even account for 1% of their risk allocation.

If they up that to 5% in the coming few years it would be a major step forward, but then again, there are enough people here who don't see that as a step forward. We'll see where this goes, but they are here whether people like it or not.

I'm however sure that we'll be seeing a whole lot more cash settled instruments in the coming years, and this will obviously make sure that there is less spot demand. For investors there is no difference, they just look for exposure.

Yeah exactly, he is wrong about BAKKT. BAKKT will be bakking up (sorry i couldn't help it  ) every futures contract with real bitcoin. They will be buying up tons of bitcoin. The people in charge of BAKKT have specifically said they want to promote bitcoin and help it become a global asset and payment method, which obviously fake/paper bitcoin products would do nothing for.

Fidelity is making an institutional grade custody solution - which is for Wall St to actually store their real bitcoin. And of course other companies like Coinbase have been attempting to provide this for Wall St as well.

I guess sure its possible Wall St will just make pretend financial products based on bitcoin's price and only a little bit of Wall St money will go into actual bitcoin, but I think it is gonna be a bit of both. And then you've got stuff like an physically backed ETFs that everyday people could put in their retirement account which will also tie up lots of bitcoin supply.
Maybe Wall St won't drive the price up to $100k all by themselves, but it seems clear over the coming years they will tie up a good amount of bitcoin and will be part of the equation as bitcoin continues to rocket upwards in price over the long haul.

Once these "Wall St approved" custody solutions are ready, any financial advisor worth anything at all should be telling any average person saving for retirement they better buy at least one bitcoin (just a few thousand dollars) now before the price gets too high. Not saying that's gonna happen, maybe by the time it happens they'll be telling them to buy at least a tenth of a bitcoin cuz prices will have risen too much, but I can definitely see Bitcoin being a normal small part of your average retirement account, and of course the average rich person getting advised that they should invest at least a few hundred thousand dollars into Bitcoin. I think once these Wall St services come online over the next year we'll see a shift to wear Wall St people start accepting Bitcoin as a normal small part of their portfolios and that could take up millions of the bitcoin supply right there.

I think we should clarify things at this point

As I got it, you are talking about paper bitcoins which don't have their back up in the form of real bitcoins ("you'll see bitcoins effectively being printed out of thin air"). But as far as I'm informed, this is not what BAKKT is going to do in practice. Basically, they are going to issue Bitcoin certificates, which are to confirm that they actually have a certain amount of bitcoins in their custody. Obviously, these are two entirely different situations (the first being essentially the same as with cash-settled Bitcoin futures), so please clarify what you mean by paper bitcoins exactly

that is irrelevant. nobody is saying bitcoin = gold. gold is not the only commodity futures market that operates this way, and collateral rehypothecation is common across all institutional markets. gold is just one example of how wall street operates---high leverage speculation and fractional reserve collateralization.


then why is BAKKT creating them? why is citibank working on digital asset receipts? i assume it's because they think institutions will want to speculate with them.

if institutions want to enter the market but not custody their own coins due to risks involved, paper bitcoins would be an obvious solution. fidelity is also working on institutional custody btw.


cash settled are specifically not paper bitcoins. volume on those markets has also been steadily rising ever since launch so i wouldn't say there is zero interest either.

There must be interest in bitcoin to these wall street wolves.
They only care about money and know when there is blood in the street its the time to buy.
All of them live and die by the words of their god and savior warren buffett.

I don't think that's going to happen

Why? Because Bitcoin is not gold. Gold is a universally accepted store of value, proved and tested by time itself. In other words, you receive what you pay for, and it can't lose its value overnight. Bitcoin is different and adding another layer of volatility will definitely be over the top. So I don't think there will be a lot of interest in paper bitcoins. Did cash-settled Bitcoin futures 1.0 spark a lot of interest?

there's a distinct possibility that wall street won't pump the market like people think. when you look at commodity futures speculation on wall street, like the gold market, not many contracts are physically delivered. it's mostly speculative trading with profit/loss being rolled into the next contracts. when you combine that dynamic with regular wall street accounting practices (collateral rehypothecation = fractional reserve) then if wall street and the rest of the market consider BAKKT-custodied paper bitcoins as real bitcoins, you'll see bitcoins effectively being printed out of thin air.

as long as a trickle of real bitcoins flows in and out of BAKKT (like USD with tether), the market will rationally see paper bitcoins and real bitcoins as equivalent. just like the gold market.

It seems to me that you are asking wrong questions

For example, you should first ask (maybe, even ask yourself) why institutions and hedge funds would want to buy Bitcoin and with what purpose in mind. Right, there can be only one purpose that any of these entities can be looking for, and that is profit. They are in exclusively for earning profit. So far so good. But here comes a tricky part. Which is, how are they going to earn dough with Bitcoin exactly?

The only way you could earn profits in the cryptoworld is by buying low and selling high. So if they are going to buy up like 5M bitcoins, what are they going to do next? Keep it or maybe even hodl it? But these people want profits, they are not anywhere close to being a typical cryptocurrency bagholder. And now ask yourself whether they would be willing to become bagholders for us as this is the right question

Between 0 and 17 millions BTC  

So, how do you define what this "Wall Street" is, every investment fund in the country, every business located on Wall Street, every company listed on the NYSE?
I'm asking this because Fidelity is headquartered in Boston and is a non-indexed fund.

Anyhow, I find it pretty interesting this curiosity people have about how much coins others have
Of course, we are all about privacy, we always tell people not to brag about how many coins they have  ..but ..but..how many he has? , when did he buy? , at what price he sold....


The 3rd or the 8th?

How would it make people move out of the market (i assume you mean move away from bitcoin)??

It doesn't matter who owns bitcoin. You can't get ripped off by Wall St simply because they own a bunch of bitcoin. You still have your bitcoin and it has nothing to do with Wall St having Bitcoin. This will just take up supply meaning there is less for everyone else, meaning prices are higher.

They must be ahead of some of the firms, but yeah, no estimates would be safe to give. At most, Wall St. would surely just introduce bitcoin derivatives just like what they're doing with stocks right now. They wouldn't dive deeper than they could unless they are really sure on what they're doing. Also, if Wall St. alone takes a huge chunk of bitcoin in circulation, this will force people to move out of the market, and perhaps stay on other less controlled environments to prevent getting ripped off by Wall St. sharks.

Fidelity mined Bitcoin back in 2015, so it's way more likely that they were on board well before that. In other words, wall street is partly in already.

The very fact that they are setting up the infrastructure required to offer custody, trading desks, futures, etc, comes all down to them trying to make it more mainstream and have them earn tons of money in the process. They will outperform, perhaps even replace most of the current crypto exchanges in the future, and it's only a matter of time.

As far as the number of coins I believe wall street owns, I don't know and don't feel comfortable guessing. I can't back up saying they own 100,000BTC, and I can't back up saying they own at least 1,000,000BTC.