This afternoon the SEC announced its decision on issuing Bitcoin ETFs due to the deadline to respond to the Ark/21 Shares ETF application. All 11 are approved.
So what does this mean and why is a Bitcoin ETF important? And here is a copy of the full approval. The SEC link is breaking so we downloaded a copy for you here.
Thanks to regulatory uncertainty in the US, the only way for big banks, investment funds, and hedge funds to invest in Bitcoin is to hold it in your own personal wallet. Either a custodial wallet or a self-custody version as most of you reading this do.
And for Fidelity or Blackrock, that just doesn’t cut it. You can’t get mass market influence, adoption, or revenue if everyone has to create their own wallet. An ETF is one of the few investment vehicles in the US with total regulatory clarity.
That and the multi-trillion dollar US investment market make this decision important.
First, this means that everyday investors will be able to access Bitcoin for its investment potential. As we’ve said.
Second, the institutional investors mentioned above are here to stay.
Today marks a definitive line between before institutions impacted Bitcoin and after. If you got some Bitcoin before the big guys, then congrats. You front-ran the biggest banks and investment funds in the world.
These 11 ETFs will absorb all of the spot markets current liquidity and then some. There is not enough liquid Bitcoin for all the ETFs to get all the Bitcoin they need to back the billions in investment expected. Many are expecting a multiplier effect on the price from the billions of new Bitcoin buying power. No one knows for sure but I agree as do many of us here at Altcoin Buzz.
Remember, they ARE allowed to do cash in and cash out instead of “in kind” where they would have to sell Bitcoin for client withdrawals. This means ARK, Blackrock, Fidelity, and all of them will be long-term holders of Bitcoin. They will just move money around as needed to fund client withdrawals.
Yesterday was chaotic with a false decision announced from a “compromised” SEC Twitter account.
This is one of the more popular opinions floating around out there about what really happened. I also believe (my own opinion not Altcoin Buzz) that either this was a scheduled tweet published accidentally or an SEC employee wanted to be the one to break the news that usually doesn’t handle the Twitter/X handle for the SEC.
Of course, the irony of requiring so many security and other considerations before approval when your own account gets compromised right before decision day is not lost on many on Crypto Twitter.
Way back in 2010, OG Cypherpunk Hal Finney (RIP) talked about Bitcoin banks. And if you’ve seen my work here you know I’ve quoted this at least a handful of times.
We often talk about this as Layer 2’s and other scaling solutions are necessary for Bitcoin to continue to grow.
There’s another way to look at it too.
It could mean these institutions holding Bitcoin in reserve means fewer individual retail transactions. Or possibly fewer self-custodying Bitcoin. If you are, then you are ahead of the game.
We’ve looked into this in previous articles here. This article from a week ago looked at pump, dump, and consolidation possibilities that could happen from the decision.
Longer term, we are still VERY bullish on Bitcoin specifically and crypto in general.
Since the decision, markets are up. Bitcoin is up 2% while Ethereum as the #2 is up 3%. Other big movers are SEI up 7%, Arbitrum up 6%, and ORDI up 6%. All from our friends at CoinGecko and all in the last hour, as of this writing.
One thing is for sure. Institutions are coming. And now they are here. They now see Bitcoin the way we do. It’s an asset. And it’s money. It’s valuable. And it retains tons of value by staying out of government hands.
I’m excited to see what happens next.
Disclaimer
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 accepted levels of risk tolerance of the writer/reviewers, and their risk tolerance may be different from 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.
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Was this really a hack? and the SEC got it back in minutes? 🤔 My account was hacked in Aug and it took 5 months, 30+ support tickets as well as reaching several people inside X to get it back My guess, this was scheduled in their account to go out tomorrow, and the intern Show more
SEC Hack Timeline: 3:11 — @SECGov tweets all #Bitcoin ETFs are approved 3:26 — @GaryGensler says SEC account was hacked ~3:38 — SEC “regains control” of their account & deletes original tweet 3:42 — SEC tweets they were hacked & have not approved ETFs Something is fishy…
bitcoin neanderthals in 2021: “if you say that most people won’t hold their own keys you are attacking bitcoin” hal finney in 2010: “most bitcoin transactions will occur between banks to settle transfers. bitcoin transactions by private individuals will be extremely rare”
