Act I, the SEC sues Binance and Coinbase to take them off the market. Second act: Citadel, Blackrock, Charles Schwab, and Fidelity file to open a Bitcoin ETF. Act III, these investment groups announce they will open their crypto exchange, EDX.
Let’s discover more about what The SEC, BlackRock, and other companies are doing to take the web3 party to their house.
Bitcoin is the New Black
Citadel, Blackrock, Charles Schwab, and Fidelity are renowned investment powerhouses that have firmly established themselves in traditional financial markets. These institutions command significant influence and possess vast resources. It is reasonable to assume that they are keenly aware of the transformative potential of cryptocurrencies and blockchain technology, which have garnered attention worldwide. Especially Bitcoin.
Source: Twitter
Considering what is happening these days, these investment giants may be eyeing the crypto space to maximize their exposure to Bitcoin. They know that the next Bull Run will be massive in the next Bitcoin halving. So, if they build their own crypto exchange while having other exchanges unable to operate in the US, they could potentially monopolize the market.
For Blackrock and company, it is all profit, since:
- The mere fact that they sell Bitcoin in the form of an ETF will cause the traditional financial world to end up regulating and adopting Bitcoin as a first step.
- The image of cryptocurrencies managed by these investment funds will be washed away. However, Bitcoin will only be seen as an investment tool, and at the same time, they will try to eliminate the possibility of anyone having their Bitcoin in their wallet without custody. This is why banks are already gearing up to offer Bitcoin custody. Deutsche Bank is one example of this.
- Such a move would enable these investment groups to bridge the regulated investment sector to the evolving web3 world. This would be their major business model.
Too Little Bitcoin for So Many Bigwigs
Nowadays, there are only 13% of existing Bitcoins in exchanges. Now imagine that in the worst-case scenario, the BlackRock ETF buys the vast majority. Do you think they will be happy with so few Bitcoins knowing that trillions of dollars of investment are coming? They will most likely start issuing ETFs that are not backed with Bitcoin that will float in their wallets.
Source: Twitter
The greed for money will cause them to do the same thing the United States did when it cut off gold backing for the dollar in 1971 with the Bretton Woods treaty. But in the crypto version. Not to confuse, ETFs will be the fictitious ones, they will not create more bitcoin.
CBDC for the People and the SEC for Competition.
As the world gravitates toward a more digitized economy, the interconnectivity between traditional financial systems and emerging technologies becomes paramount. So, Central Bank Digital Currencies (CBDCs) are being explored and implemented by governments globally. In this context, the introduction of a new cryptocurrency exchange by these investment giants aligns with the ongoing trend toward digital financial infrastructure.
So, If these investment groups successfully establish their own cryptocurrency exchange, along with the potential implementation of the CBDC FEDNow, it is plausible that the future of buying Bitcoin and other cryptocurrencies in the United States could be limited to the wealthiest individuals. Then, the increased regulation and concentration of power in the hands of a few powerful players could inadvertently restrict access for retail investors, stifling innovation and hindering the decentralized ethos that underpins cryptocurrencies.
Source: Twitter
Thanks to this, what will most likely happen when Bitcoin ETFs work is that Blackrock and the company will start buying Bitcoin en masse through their own exchange. As a result, this will cause the price of Bitcoin to rise exponentially. This can happen during the next year, which is the time for the next Bitcoin Halving.
Conclusions
Finally, the big investors who laughed at Bitcoin in the past years are now doing their best to buy it in large quantities and take advantage of the next bull market.
For this, they are using the SEC to take out recognized exchanges such as Binance and Coinbase in the U.S. and make their own exchange to have the prominence they are used to having in traditional finance.
Note: This is an analysis based on events up to June 22, 2023. I will bring out other articles with updates in the future.
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