Bitcoin ETF Circuit Breakers \ stacker news ~bitcoin

1995 sats \ 12 comments \ @kr 21 Mar bitcoin

i haven’t seen much discussion about this, but it might be wise for anyone holding shares of a Bitcoin ETF to understand the circumstances under which trading might be halted.

on Stacker News most of us understand the value of custody and how it ensures access to one’s coins, but the risks associated with a market shutdown during extreme price events are not talked about as much. even if your coins are safe, you may not be able to buy or sell when you want if you rely on traditional finance rails for Bitcoin exposure.

i know there are circuit breakers that halt all trading when the S&P 500 falls more than 7%, 13%, and 20%, but I’m not as familiar with the rules for individual stock circuit breakers and whether they are also enforced for ETFs. i think there are even circuit breakers for upside price swings, not just downside ones (someone correct me if i’m wrong).

i wouldn’t be surprised to see crazy price action that causes traditional financial markets to trigger circuit breakers, and want to help Bitcoiners who have exposure to ETFs better understand those risks.

can anyone share a template that shows all the conditions under which Bitcoin ETF trading will be halted?

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475 sats \ 1 reply \ @tomlaies 21 Mar

Markets (like eg the nyse or nasdaq) are agnostic to which piece of paper is traded. Apple stock has the same circuit breakers as AMD stock. The Bitcoin etf will halt at the same markers like other securities. Idk if they have special buckets for etns - they might have special rules that only apply to commodity funds tho.

20 sats \ 0 replies \ @WeAreAllSatoshi 22 Mar

This is what I figured as well

315 sats \ 1 reply \ @grayruby 21 Mar

ETFs are considered single stocks so I imagine they would be subject to single stock circuit breakers.

20 sats \ 0 replies \ @WeAreAllSatoshi 22 Mar

This is what I figured as well

105 sats \ 6 replies \ @kepford 21 Mar

This is a great point and another reason to self custody. It will be interesting to see if the ETFs trigger circuit breakers, or as I call them rigging of the system. And, how much that affects bitcoin in the free trade market.

124 sats \ 5 replies \ @kr OP 21 Mar

this one may be a bit of a stretch (i think odds are well below 10%), but i wonder if large Bitcoin-native exchanges will also be pressured to stop trading during extreme price volatility

after all, circuit breakers only really work if they stop all trading

117 sats \ 1 reply \ @nerd2ninja 21 Mar

Is Conbase going down when Bitcoin price is going up not an example of that?

Well, they did that even before the ETF tho.

126 sats \ 0 replies \ @kr OP 21 Mar

yeah that’s a good point, i was thinking about a government enforced halt, but their unscheduled platform issues have a similar effect.

117 sats \ 2 replies \ @kepford 21 Mar

Yep. After all, we can't have this extreme free market activity going on. People might actually learn a lesson about risk/reward. They need to keep us believing that we need them.

105 sats \ 1 reply \ @kr OP 21 Mar

it’s far too extreme for the boomer mind to comprehend

209 sats \ 0 replies \ @kepford 21 Mar

What always cracks me up and must be honest, I get a ton of enjoyment out of this. Is when I'm with folks that think they are edgy in politics for whatever reason and they think they are gonna shock me. Without going into specifics it is fun to surprise them and see them realize how boring their views are. Usually this is around something to do with freedom.

The truth is most people are just not thinking. They are simply reacting at best. I was there for most of my life. Still have to fight it. Trying not to be a reactionary. Trying to question the stories we are told. The labels people try to affix to us. Freedom starts in the mind and that is the battle ground.

0 sats \ 0 replies \ @Satosora 22 Mar

I saw on reddit the other day where there was a candle stick for a buy order for 130k. I dont know if it is true or not, but something should have stopped that from happening. I think it was on bitfinance? Anyone willing to corroborate this story?