The Securities and Exchange Commission (SEC) is having a busy holiday season. Rumors are swirling over all the meetings it is having with financial institutions about their applications regarding a Bitcoin Spot ETF.
Here is an X post that lays out what is taking place.
If this gets approved, it will be a major step forward. We will likely see prices run as people look at Bitcoin in a new light.
A Bitcoin ETF will alter the crypto industry completely. This will move it closer to Wall Street control since a lot of Bitcoin will be purchased due to investment in the ETFs, causing buy demand. The difference is the coins will need to have an entity act as a custodian. This is where Wall Street institutions enter the picture.
Many have selected Coinbase to operate in this manner. There will be others whi get approval from the SEC. Whoever is doing it, this goes against the tenet of not your keys, not your crypto. Of course, Wall Street doesn't care about that, nor do the investors.
In this instance, the units in the ETF are a derivative of the actual asset. The value of the ETF is tied to that of Bitcoin yet it is meant to mirror price moves.
Why this is important is because an ETF will allow for retirement and institutional money to enter. These funds are excluded from buying Bitcoin (or any other cryptocurrency) directly. Many wonder why this will make a difference and here it is.
There are a lot of people who have little in savings or investment funds. However, they have a nice chunk placed in a retirement account. Since ETFs are purchased in the same way as stock, it is something the masses can do.
Will this drive the price of Bitcoin to $100K?
Many are wondering what will set off the next leg of the bull run. This is certainly something that can push the market to levels that many are projecting.
I would say this is part of the process that is going to increase the market capitalization to much higher levels. We see what happened with gold and other commodities that entered the realm of ETFS.
Of course, from a purist standpoint, this is pulling Bitcoin off the market and putting it in the hands of Wall Street. This is not what was envisioned so many years ago based upon the origin story we are told.
Nevertheless, this is the direction things are heading in. Remember, fixed money always pools and Bitcoin is no different. This could be a good thing for the price. People will probably make a great deal of money out of the deal. However, this is being rapidly merged into the existing financial system.
The SEC is well aware of this. Whatever angle Gary Gensler is working, he is a Goldman Sachs guy. He fully understands how this all works. The goal of regulators is to put cryptocurrency in the hands of Wall Street.
At this point, there is little doubt about that. Here is where a Spot ETF will aid in the transition. Retail is going to end up buying derivatives while the BTC is held by the institutions.
For those who have some Bitcoin, it is going to be a profitable time. As for changing the world, this is going to fall short.
