What is a Spot Bitcoin ETF? What opportunities will the introduction of ETFs bring? | Posted by CryptoLola | Coins | January 2024
On January 11, 2024, the U.S. Securities and Exchange Commission (SEC) approved the application for a spot Bitcoin ETF, and at the same time, ETF applications from 11 institutions were approved. Bitcoin brought about a breakthrough and opened a new chapter in the crypto industry.
The entire cryptocurrency market is celebrating this historic moment, and the Bitcoin ETF has finally passed!
The news of Bitcoin ETF adoption has given rise to several misunderstandings.
Some people say that institutions or individuals intentionally manipulate markets. Some are interns, some are hackers. News is a mixture of truth and lies, and it causes big fluctuations in the market every time.
Conversely, this time the ETF actually passed and the boots fell on the ground. Anyway, BTC is relatively quiet and is currently priced at $46,000.
1. What is a Spot Bitcoin ETF?
A Bitcoin ETF is a financial instrument that tracks the price of Bitcoin, an investment fund that allows investors to buy and sell it on traditional stock exchanges.
Investors can participate in Bitcoin trading on traditional stock exchanges, which is a convenient way to participate in cryptocurrency without having to manage digital assets. More importantly, it is regulated and free of policy risk.
Approval of the Bitcoin ETF application establishes a link between the traditional financial system and decentralized cryptocurrencies, allowing more ordinary people to have a channel to participate in cryptocurrencies and allowing traditional investment assets to enter the cryptocurrency market. This brings profits to the Bitcoin market. More liquidity.
The Bitcoin ETF idea first emerged in early 2010. At the time, cryptocurrencies were favored by investors but rejected by mainstream markets. Cryptocurrency supervision by related organizations is also relatively tense.
BTC’s development also experienced ups and downs, rising to $69,000 at one point and experiencing an annual decline of more than 85% at one point.
Applying for a Bitcoin ETF had many twists and turns in the process. I was always rejected and never gave up. After 14 years of effort, the Bitcoin ETF has finally passed.
2. How to buy Bitcoin ETF?
This time, 11 Bitcoin ETF applications were approved, including Grayscale, iShares, ARK Invest, WisdomTree and other institutions.
Among these, Grayscale (GBTC)’s asset management scale is approximately $46 billion, and BlackRock’s iShares is first in the industry with an asset management scale of $9.42 trillion.
Among the ETFs, six will be listed on the Chicago Board Options Exchange (CBOE), three on the New York Stock Exchange (NYSE), and two on Nasdaq.
No wonder various communities are joking about it today. Everyone’s status rose, and he became a respected decentralized financial investment research consultant analyst for NASDAQ, the New York Stock Exchange, the Chicago Exchange, and American stock traders.
Of course, for domestic players, opening a US stock account such as the Chicago Board Options Exchange, New York Stock Exchange, or Nasdaq may require some twists and turns.
But does the U.S. SEC’s approval of the Bitcoin ETF application mean that other countries’ policies on cryptocurrencies will relax and the entire cryptocurrency market will face a new situation? Eventually, it was recognized.
3. Impact of Bitcoin ETF introduction on the cryptocurrency industry
Although the Bitcoin ETF passed, the BTC price did not experience an explosive rise. This may be due to the past ‘crying wolf’ which consumed a lot of market sentiment and liquidity.
However, the ETF has driven the rise of other tokens, especially various tokens in the Ethereum ecosystem. ETH increased by 10 points and ARB by more than 20 points.
With the passage of the Bitcoin ETF, cryptocurrency regulation changed from blockage to relaxation. BTC has a legal identity, opening the door to traditional investment institutions, providing liquidity and stability to the entire cryptocurrency market.
Bitcoin is also scheduled for another halving in 2024, with each halving accompanied by a price increase. The crypto market will see a breakthrough in 2024.
Hal Finley, who has been exchanging emails with Satoshi Nakamoto for the past two days and helping Satoshi Nakamoto test Bitcoin mining software, was found to have tweeted “Run Bitcoin” on January 11, 2009 .
Today, 15 years later, BTC has finally received mainstream recognition. With its official status, Bitcoin’s development will usher in a new era.
And as we witness and participate in this historic moment, BTC will continue to change the world. This process is fraught with risk and can return to zero, but it also actually affects each of us.
The above is only personal opinion and does not constitute investment advice. My name is CryptoLola and I follow the cryptocurrency market and web3.