231 sats \ 7 replies \ @birdeye21 15 Jun 2023 \ on: BlackRock Close to Filing For Bitcoin ETF Application: Source bitcoin
this is how they attack bitcoin...by steering the masses away from self-custody and into ETFs, only for them to later find out they're holding paper bitcoin
Mega rug pull in the works
I would be very surprised by this. Gold or other commodities have ETFs as well.
Of course it is bad that it steers people away from self custodial. And the fees will be ridiculous like in other commodities 😂
But no will they rugpull like those shady grifter custodial exchanges
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Gold market is apparently 100:1 paper ounces to physical ounces though
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I'm pretty sure that's an internet legend / common missinformation based on a missunderstanding on how options work
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Why are you so sure it's going to be a rug pull? Seems like a good entry point for a lot of people. I don't think billions of people doing self-custody is likely, especially for small amounts.
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rug pull in the sense that if they need real bitcoin, they'll quickly learn they don't have any available, and at that point they better hope they have easy and timely access to acquire real bitcoin
complacent ETF holders without proper education may sit in Bitcoin ETFs thinking they'll cash out for dollars in the future only to learn those dollars are much less valuable
I agree that billions holding self-custody isn't the likely path forward, but you can't even use an ETF as custodial bitcoin for payments/transfers/etc., the ETF just an investment vehicle afaik
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You're right, it's meant as an investment vehicle. As long as it's fully backed, I don't see a problem. The price will likely go up significantly, bringing a lot of publicity. If even 5% of people who buy the ETF to get rich end up going down the rabbit hole, the world will be a better place.
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Maybe the ETF will serve as an educator for some, but if it only drives 5% down the rabbit hole, at the expense of 95% being stuck with paper bitcoin, I don't know if that's a net positive.
I get the benefit on paper of getting spot ETFs - it's the legitimizer needed to get institutions on board - but if we do go full hyperbitcoinization, the mass exodus out of tradfi could be very painful
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