The Secret Agenda of Big Players: BTC ETFs Only! Goodbye ETH, SOL, MATIC ETFs

ETF! ETF! It’s the one thing dominating crypto news right now. A big decision on the first ETF application update from Cathy Wood’s ARK Investment is coming down this week. We could see huge fireworks in the crypto market.

Or maybe not, even. No one knows. We are bullish. But here’s one question. Why do all the big players want Bitcoin? And why is there almost no talk of an Ethereum ETF? Why is there zero talk about a Cardano, Solana, Polygon, or Cosmos ETF? Well today, we are going to expose why big players want only BTC ETFs to be approved and not ETH or any other crypto.

Bitcoin vs Altcoins ETFs

First of all, Bitcoin is the soundest money in the world right now. It has a fixed supply that is hard-coded into the system. To change it is a huge undertaking. This is why people with different ideas of what Bitcoin should be don’t change it themselves. They hard-fork it and make their changes.

And some crypto like Litecoin can differentiate themselves and even work alongside Bitcoin. Their missions are very different. But others like BCH or BSV, are failing in comparison to Bitcoin’s performance.

If you are an Ethereum fan, and an ETH holder and user of it and EVM, and you believe in that “ultrasound money” meme, then you are believing in nonsense. I hate to be the one to break it to you.

We talk about many Proof of Stake networks on this channel. And we like many of them. Some are in the control of very few, while others are more decentralized. The bottom line is this. Many projects including the PoS version of Ethereum run exactly like fiat banking and finance.

Don’t believe us? Well, have you ever heard that joke about the golden rule? That the real golden rule is that he who has the gold makes the rules.

Liquid Staking Rewards Centralizing PoS Protocols

That’s the fiat system with banks, other institutions, and governments making the rules. And if you are in a PoS network with a high concentration with a few validators, then you have a fiat-like system going on. And Ethereum has a high concentration. ETH currently has 900k validators, according to our friends at Staking Rewards. But wait, that sounds super decentralized to me.

Right? WRONG. Lido alone has 288k validators. Thanks to its liquid staking program. Other big liquid stakers like Coinbase, Rocket Pool, and Binance add another almost 200k validators. So now almost 50% of the validators are from only 4 liquid staking protocols. If Lido or Coinbase wants to suggest a change to Ethereum in some way, there’s no doubt Ethereum will have to listen to it and consider it. That’s even if they don’t do it in the end.

Proof of Stake made Ethereum much more highly concentrated and centralized. Then there are some other protocols we like. Like Cosmos or Cardano. Cosmos we love. And their governance is super active. Maybe too active. Plus, the devs can make an unlimited supply and it’s always inflationary. So that’s out for the investment pros.

More About Comparing Bitcoin with Other Crypto Ventures

Cardano. Nearly all users stake Cardano. Its Nakamoto Coefficient is pretty good. This is a measure of decentralization of how many nodes could control at least ⅓ of the network. For Ethereum, it’s 1. Lido. For Cardano, it’s 50 as of December. This is much better. In fact, of the big networks, it’s 2nd best to Polkadot at 92.

Honestly, Cardano, Cosmos, or Polkadot are just not big enough yet or trade enough volume for big institutions. Especially ETF-style big. All trade well under $1 billion daily. They range from $180 million-$580 million. ETF trading volume is in the multi-billions of dollars per day. These markets are not big enough, don’t trade enough, and are not liquid enough for this. That’s even if you agree with all the philosophical and design principles of each network.

Custody = Huge Money

Have you heard the term “authorized participant” (AP) in all the ETF talks? It’s an important concept and it shows why big players want Bitcoin. Here are 2 big reasons why being an AP is good:

  • An AP can create or redeem shares of an ETF. They also get to maintain custody of the securities. This is the big one. Imagine even earning 10 basis points or 1/10th of 1% on an ETF with $100 billion in assets under management. That would be $100 million with no market risk in that position either. To hold and maintain custody. Now you can see why custody of a Bitcoin ETF is such a big deal.
  • If they were a market maker, the institution would have to be able to broker trades as well as provide buy and sell sides of trades to help keep a market liquid. As an AP, you can trade actively for your account and hold an inventory of Bitcoin to wait to sell to others. For a single asset ETF like Bitcoin, this is a MUCH better deal than being a market maker.

Who Is and Wants to Be an Authorized Participant?

So Coinbase is already going to be one of the big winners upon approval. Most of the top ETF applications have Coinbase listed as their AP and custodian. Including Blackrock. Fidelity is going to the custody of their own BTC. This makes their offering a little more true to Bitcoin’s mission. Now, Goldman Sachs wants in. Grayscale and Blackrock are in talks with Goldman. In Grayscale’s case, they are hoping to convert their GBTC into an ETF. If approved to do so.

So big institutions finally see what we knew all along. Bitcoin is a great form of money and a great asset. And as Dollars and other crypto around the world continue their inflation and devaluations, Bitcoin only becomes more valuable. And with only 21 million of them, The Goldmans and Blackrocks of the world want their piece of it.

So if you have some and you front-ran them, congratulations. If you don’t, you should get some. They will only get more scarce when they have to program billions of dollars of daily purchases.


The information discussed by Altcoin Buzz is not financial advice. This is for educational, entertainment, and informational purposes only. Any information or strategies are thoughts and opinions relevant to the accepted levels of risk tolerance of the writer/reviewers and their risk tolerance may be different than yours. We are not responsible for any losses that you may incur as a result of any investments directly or indirectly related to the information provided. Bitcoin and other cryptocurrencies are high-risk investments so please do your due diligence. Copyright Altcoin Buzz Pte Ltd.


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