Shower thought. Bitcoin ETF bad? - page 2.

mk4

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Quote from: GreatArkansas on September 11, 2019, 12:31:51 AM

And for me, I don't think ETF can drive the price or Bitcoin at an 'appreciable level'.

I don't know why a lot of people think that a bitcoin ETF will make bitcoin rise in price either. Not saying that a price rise won't happen, because an ETF can give bitcoin a lot of legitimacy in the eyes of the masses, but it's just like any other open market whereas people can long or short bitcoin. In fact, it's also really possible that an ETF would drop bitcoin's price. In the end, it still, as always, boils down to supply and demand.

Quote from: Wind_FURY on September 12, 2019, 03:51:03 AM

Then the actual point. "Is allowing the custody of Bitcoin to institutional third parties, without thinking of the consequences, good or bad?"

Could be either. ETFs will be used by people who doesn't care about financial freedom/sovereignty but only cares on the speculative aspect(whether bullish or bearish) of bitcoin.

Wind_FURY

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Quote from: Kakmakr on September 12, 2019, 02:29:44 AM

The way that Bakkt is doing it with the warehouse, might be the best way of doing it. A Bitcoin ETF must be backed by actual bitcoins and the ideal scenario would be for the owners of those coins to have sole access to the Private keys for those coins.

I can understand that institutional investors would want to avoid having the hassle of dealing with the safekeeping of coins and wallets and such, so they would pay a third party to do it on their behalf. The risk is much lower for them to invest in Bitcoin then and it is backed by actual bitcoins. Wink

Then the actual point. "Is allowing the custody of Bitcoin to institutional third parties, without thinking of the consequences, good or bad?"

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The way that Bakkt is doing it with the warehouse, might be the best way of doing it. A Bitcoin ETF must be backed by actual bitcoins and the ideal scenario would be for the owners of those coins to have sole access to the Private keys for those coins.

I can understand that institutional investors would want to avoid having the hassle of dealing with the safekeeping of coins and wallets and such, so they would pay a third party to do it on their behalf. The risk is much lower for them to invest in Bitcoin then and it is backed by actual bitcoins. Wink

Wind_FURY

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Quote from: Foxpup on September 09, 2019, 04:33:22 AM

The freedom to do what one wants with one's bitcoins necessarily includes the freedom to give custody of them to a third party. Some (such as those who are unwilling or unable to safely manage their own private keys) will find such an arrangement beneficial. And some will not benefit from such an arrangement, and choose not to use it. That's what freedom means.

But what about if Bitcoin custodial services, and exchanges, cartelize then form an agreement with each other that would be possible for them to censor transactions.

Should the community encourage everyone their right of "freedom" to let your Bitcoins in be in custody of a third party?

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Quote from: jseverson on September 11, 2019, 04:31:32 AM

At the end of the day, no ETF is going to affect Bitcoin itself, so I'm personally not against it. It may be bad for corporations to stock up on huge amounts of coins, but they're free to do just that anyway, ETF or no ETF.

It may not affect the protocol, but it can certainly affect the price. The trustee would issue and redeem shares based on market demand, meaning an ETF could conceivably lead the rest of the market due to arbitrage forces. The same goes for Bakkt or any other physically delivered bitcoin contracts. Plus, ETF shares can be short sold. When I strap on my tin foil hat, I can see some scenarios where Wall Street keeps a lid on bitcoin prices through these avenues, the same way they supposedly do with gold.

ololajulo

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I got reservation for the ETF, maybe we might not need it anyway. I thought it could help in this current market to bring new investment from institution but the recent ETF is not a true representative of what we want. Just like adding a document with crypto name in SEC file. They request for a good sum of money from investors with no chance for investors with bitcoin crumbs.

jseverson

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Quote from: fullhdpixel on September 11, 2019, 03:01:22 AM

Sometimes when I see how we encourage and push for ETF, I really wonder if some of us really understand what cryptocurrency is about and what decentralization stands for. Well, one thing that we know is that even if ETF is being approved, it would still not stop bitcoin from being a decentralized coin which is what people want the most.

The thing is though, most Bitcoin holders will probably ignore any ETF despite clamoring for it. All it means for them is more money in the market, and Bitcoin being legitimized as an asset class to some extent.

It would then come down to context as to whether it's bad or not. Is it bad to hold? For experienced Bitcoiners, that's almost certainly a yes. Actually holding coins is going to be better for just about every purpose. Is it bad for the market? It could be, but the opposite is also very possible, if not more probable.

At the end of the day, no ETF is going to affect Bitcoin itself, so I'm personally not against it. It may be bad for corporations to stock up on huge amounts of coins, but they're free to do just that anyway, ETF or no ETF.

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Quote from: Wind_FURY on September 09, 2019, 03:29:57 AM

Shouldn't the communty discourage the creation of anything that gives up the custody of Bitcoin to third parties?

Although it might be good for its price, would it be good for Bitcoin as a censorship-resistant hard money?

With ETF, we are just indirectly giving chance to centralization of cryptocurrency which we should really discourage because there won’t be any difference from all the system that we have on ground already if we still use cryptocurrency in a centralized way. The reason why we have been so all over bitcoin is because it gave us freedom and one sense of ownership to our money and to our transaction, so why on earth would we give that out to ETF.

Sometimes when I see how we encourage and push for ETF, I really wonder if some of us really understand what cryptocurrency is about and what decentralization stands for. Well, one thing that we know is that even if ETF is being approved, it would still not stop bitcoin from being a decentralized coin which is what people want the most.

GreatArkansas

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Quote from: leftgirly on September 10, 2019, 05:58:36 PM

The ETF agreement is just one of those initiatives that can easily help maintain the price of bitcoin at an appreciable level. (....)

But do you consider the being decentralized of Bitcoin? Like if you do that ETF things, you are actually buying a Bitcoin but not actually owning it, it's just like you will escape the actual trading and owning of Bitcoin.
And for me, I don't think ETF can drive the price or Bitcoin at an 'appreciable level'.

prix

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The ETF is the way for users who cann't or don't want to understand the details of crypto. And for users of those countries where the crypto is in the gray zone or is banned (at least I know I person which wait ETF for that). In this case there will be no problems with the buying, nor with the selling, nor with the taxes.

Leonardo7

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Not everyone definitely will subscribe to ETF, but everyone has their choice to make, it entirely boils to an individual on how they use their money. I personally hate a third party holding my money for me, but still, if this will bring more liquidity to the market it's okay.

leftgirly

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The ETF agreement is just one of those initiatives that can easily help maintain the price of bitcoin at an appreciable level. Imagine a company guaranteeing your property without causing any financial commitment from your end. Basically, that is the idea behind ETF, I don't think this means a third party would be given the power to control bitcoin on the market.

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Quote from: DooMAD on September 10, 2019, 05:20:28 AM

Quote from: ene1980 on September 09, 2019, 06:55:04 PM

majority of the people will find it difficult to safe guard their private keys and people will find it useful to invest in ETF.

Do the "majority of people" use a broker service, though? With the exception of some free shares I was given by my employer, I sure as hell don't, but that might just due to my distrust of traditional finance. Because if people aren't using a broker, that's the only way casual investors can access an ETF.

The most interesting thing that could develop from an ETF is people investing tax-free through their 401(k)s. It wouldn't be available at first through most employer plans, but it could be done through self-administered accounts. Eventually, who knows? Maybe Blackrock and similar firms will be offering exposure through regular employer plans within a few years. If there's demand for it, they'll make it happen.

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Quote from: franky1 on September 10, 2019, 11:23:11 AM

bitcoinFX..
an ETF is not somthing people use to own bitcoins. just like going to a betting shop is not somewhere people go to own a horse/greyhound

an ETF/betting shop is just used for people to buy a certificate that says thy put certain value in. and then bet on the results of the movements of the other thing they do not own and never did.

however those buying bitcoin via proper bitcoin buying means. can buy bitcoin and own bitcoin. but an ETF is not the tool to own bitcoin. its just a fiat betting/investment tool based on the results of bitcoins price movements

@franky1

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... and your telling me this is a good thing ?

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Quote from: Wind_FURY on September 09, 2019, 03:29:57 AM

Shouldn't the communty discourage the creation of anything that gives up the custody of Bitcoin to third parties?

Although it might be good for its price, would it be good for Bitcoin as a censorship-resistant hard money?

I believe bitcoin ETF may be beneficial, but it seems to me that we are far from seeing some bitcoin ETF... look at this news:

VanEck’s New Bitcoin Trust Assets Total Just $41K in First Week

only 4 bitcoins, this shows that investors want things well regulated and by the past news:

SEC Postpones Decision on Three Bitcoin ETF Rule Change Proposals

Source: https://cointelegraph.com/news/sec-continues-to-stall-on-btc-etfs-all-in-wait-for-breakthrough

maybe in the next 2 years we'll see some bitcoin ETF getting approved, because I highly doubt that before 2 years the SEC approves some bitcoin ETF

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Quote from: Wind_FURY on September 09, 2019, 03:29:57 AM

Shouldn't the communty discourage the creation of anything that gives up the custody of Bitcoin to third parties?

Although it might be good for its price, would it be good for Bitcoin as a censorship-resistant hard money?

No, bitcoin ETF is not necessarily a bad thing that can happen to crypto market. After all we all want to see bitcoin is being adopted everywhere in the coming future and at the same time we all know it doesn't going to happen overnight! We have to take baby steps to reach the goal and I see ETF as one of those baby steps which can fuel the adoption across the world.

However, I only support ETFs that are physically settled. Means, the ETF provider is going to deal in physical bitcoins and not just on the price of bitcoins. Physically settled bitcoin ETFs are actually useful to the market as it gives additional liquidity to the market.

I understand, that difference in opinion will be there as many people wouldn't want to comply with KYC norms or give up their identities and wealth in the hand of third parties! But being a law abiding citizen, I would personally want to see more and more physically settled bitcoin ETFs or investment assets to come to the market. It will not only increase the adoption rate but also make bitcoin more useful to the real world.

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Quote from: abdobe on September 09, 2019, 04:42:18 AM

Quote from: Wind_FURY on September 09, 2019, 03:29:57 AM

Although it might be good for its price, would it be good for Bitcoin as a censorship-resistant hard money?

Quote

A Bitcoin ETF defeats the purpose of being your own bank, because you're effectively letting another company hold the funds for you. It's pretty much an oxymoron. But the thing is, not everyone that buys bitcoin is buying it for financial freedom/sovereignty. Some are simply buying because they're betting that the price will go up in a certain timespan. Here's where the Bitcoin ETF comes in: the investor wouldn't need to risk holding their own funds and securing it on their own. Instead, they let a company that supposedly knows how to secure the funds, hold it for them.

You explained Bitcoin ETF propose very good, however, can we say for sure that such a company will definitely safe Bitcoin funds and be able to increase its amount?

You are gonna risk your account for plagiarism if you do not quote the post properly. There are bots that identify a post for plagiarism automatically. Hence I would recommend you to quote the post properly.

Quote from: Foxpup on September 09, 2019, 04:33:22 AM

The freedom to do what one wants with one's bitcoins necessarily includes the freedom to give custody of them to a third party. Some (such as those who are unwilling or unable to safely manage their own private keys) will find such an arrangement beneficial. And some will not benefit from such an arrangement, and choose not to use it. That's what freedom means.

And that's how the third parties take advantage of your situation and thus scam you.
Freedom does mean to do anything with your coins, but it also invites scammers and hackers to your den.

franky1

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bitcoinFX..
an ETF is not somthing people use to own bitcoins. just like going to a betting shop is not somewhere people go to own a horse/greyhound

an ETF/betting shop is just used for people to buy a certificate that says thy put certain value in. and then bet on the results of the movements of the other thing they do not own and never did.

however those buying bitcoin via proper bitcoin buying means. can buy bitcoin and own bitcoin. but an ETF is not the tool to own bitcoin. its just a fiat betting/investment tool based on the results of bitcoins price movements

BitcoinFX

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Quote from: franky1 on September 10, 2019, 08:33:02 AM

Quote from: BitcoinFX on September 10, 2019, 08:17:05 AM

Quote from: Foxpup on September 09, 2019, 04:33:22 AM

The freedom to do what one wants with one's bitcoins necessarily includes the freedom to give custody of them to a third party. Some (such as those who are unwilling or unable to safely manage their own private keys) will find such an arrangement beneficial. And some will not benefit from such an arrangement, and choose not to use it. That's what freedom means.

If you give custody of your bitcoins to a third party - then they are no longer your bitcoins.

- https://en.wikipedia.org/wiki/Possession_is_nine-tenths_of_the_law

Freedom isn't free. Not your keys, not your coins.

- https://en.wikipedia.org/wiki/Exchange-traded_fund

Yes. Bitcoin ETF bad.

again the bitcoins of an ETF were never the customers. the customers did not buy btc and then give them to a custodian.

a company buys the bitcoin from an exchange/private OTC and its the companies property. fully owned legitimately by the company. they then separately collateralise the holdings, and sell shares.
those buying shares dont own the bitcoin, before during or after.

as for the accounting/auditing. easy. just show the public keys of the companies holdings. anyone can check that the company is holding what it says.
EG if 20 shares is measured as 1btc. and the company has released 2million shares. then the company has to sign a message linkd to a hoard of 100k coins

Exactly, one can ... "never own paper ~~metals~~ bitcoins."

...

- https://youtu.be/UxvmdR7oYdQ

franky1

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Quote from: BitcoinFX on September 10, 2019, 08:17:05 AM

Quote from: Foxpup on September 09, 2019, 04:33:22 AM

The freedom to do what one wants with one's bitcoins necessarily includes the freedom to give custody of them to a third party. Some (such as those who are unwilling or unable to safely manage their own private keys) will find such an arrangement beneficial. And some will not benefit from such an arrangement, and choose not to use it. That's what freedom means.

If you give custody of your bitcoins to a third party - then they are no longer your bitcoins.

- https://en.wikipedia.org/wiki/Possession_is_nine-tenths_of_the_law

Freedom isn't free. Not your keys, not your coins.

- https://en.wikipedia.org/wiki/Exchange-traded_fund

Yes. Bitcoin ETF bad.

again the bitcoins of an ETF were never the customers. the customers did not buy btc and then give them to a custodian.

a company buys the bitcoin from an exchange/private OTC and its the companies property. fully owned legitimately by the company. they then separately collateralise the holdings, and sell shares.
those buying shares dont own the bitcoin, before during or after.

as for the accounting/auditing. easy. just show the public keys of the companies holdings. anyone can check that the company is holding what it says.
EG if 20 shares is measured as 1btc. and the company has released 2million shares. then the company has to sign a message linkd to a hoard of 100k coins

Topic: Shower thought. Bitcoin ETF bad? - page 2. (Read 657 times)