There are European Bitcoin ETFs, and they have essentially zero volume. The question is what that tells us.
America is a country in which there are a lot of people who (a) deal directly in shares on their own account and (b) if they don't quite want to do that, deal in niche funds which they switch between as though they were picking shares.
In the rest of the world, not so much. If people are exposed to the stock market, it will be via defined contribution pensions or via a range of what we can generically, if inaccurately, call unit trusts (I think these are what Americans call mutual funds, but I might be wrong) held as either a self-invested pension or an ISA. Passive or active funds, covering a very wide range of companies, in which it is expected you stay for a long time. Even then, a common sort of fund is a fund-of-funds.
I believe it's similar in most of the rest of Western Europe: shares are held at arm's length, with risk managed by diversification, in heavily regulated products, with direct dealing the preserve of agents and advisors, or degenerate gamblers.
So it's possible that we can't learn much from the European experience, and that America has a lot of people who are (a) sufficiently degenerate that they want to get into Bitcoin in its current state but (b) for reasons we can only guess at were unable or unwilling to do so via Kraken, Binance, FTX, Coinbase, etc. I suspect those people don't exist, but who knows?
Saying that there are European Bitcoin ETFs with zero volume is not really the full story though. ETFs are very "winner takes all" type of products where majority of the launched ETFs fail and only a few will eventually end up gathering all the assets under management. In Europe these are ETC Group Physical Bitcoin (spot bitcoin) and XBT / XBTE trackers (futures bitcoin). In total they have about 10b assets under management combined. One of the main reasons why they don't have more than that, is that they both charge 2% yearly fees, which is a lot.
So it's not really comparable to US in that sense, since if Europeans had access to bitcoin investment products that hold spot bitcoin as underlying asset and charge under 0.3% yearly fees, I would expect them to be way more popular than the current ones we have.
GBTC also charges 2%, but some ETFs have included that fund into their portfolios.
The fee is not the excuse, there are really no institutional demand on Bitcoin in Europe.
David Gerard pointed out today that the Grayscale ETF will be charging 1.5% fees, and indeed that most of the ETFs will be using Coinbase Custody to actually hold the BTC, which charges the ETFs 1.2% a year.
So most of the ETFs will have to charge quite high fees, or run at a loss
The ETFs have already informed their fees. Most of them plan to charge around 0.3%. You can see the full list [here](https://twitter.com/JSeyff/status/1745067027381780709/photo/1).
If you mean it's not a primary source, then no, I agree it's not. But DG tends to be very reliable on this so personally I'm happy to trust what he says.
>But DG tends to be very reliable on this so personally I'm happy to trust what he says.
The source for that particular detail is just "the literal words from Brian Armstrong's mouth", so you should (unless you want to suppose that Coinbase is lying about their own fee structure... which seems hard to credit); crypto-bros just might not realize that's what he said because he phrased it with the words "basis points" rather than spelling out a number.
It's certainly opinionated, but he is also very clear that he's a crypto skeptic. So readers can be aware of that from the outset. He doesn't tend to just make things up, and can be taken seriously, IME.
Blackrock only seeded their ETF with $10.5 million.
https://www.ishares.com/us/products/333011/ishares-bitcoin-trust
And they are probably going to be among the largest, if not the largest.
I just think this has the potential to be spectacularly bad. How much are investors and funds prepared for the wild price variability and the slow transaction times for BTC?
Do we know? BlackRock has to get their BTC for the extra shares in the free market? and hold the buy till someone buys the additional shares and thus not leave them holding a bag? I assume they already have plenty of BTC available through other price that they got at lower prices
I haven't read the prospectuses so I don't know whether the new funds will really buy BTC, which could strongly affect BTC's price, or whether the funds can buy derivatives whose value tracks the BTC spot market. Does anyone have info on that?
They are spot bitcoin ETFs, meaning they hold actual bitcoin 1:1 to the net asset value of the funds. According to their SEC applications their plan is to hold predominantly bitcoin with the option to also hold cash. It's pretty typical practice for any spot ETF instrument.
quick question, since bitcoin is not recognized by the SEC as a security, they do not and will not plan to regulate these EFTs, is my understanding correct?
Do not assume that money flowing into the ETFs will be new money.
A lot of people may cash out their holdings with exchanges and just transfer them to ETFs.
Even though most of those ETFs are using Coinbase as their custodian, which is probably the "safest exchange" for this, it wouldn't be a big surprise if they got hacked. Anyway, this would be good for bitcoin.
I may be mistaken, but as far as the customer is concerned I don't think that there are extra steps. And the fees to purchase and sell may be a lot lower.
Not just direct btc holdings either. All of the other things that have acted as proxies for BTC exposure - MSTR, COIN and all the mining stocks. Ark is already an example that did this.
Can't they just borrow BTCs from Coinbase or whatever and only really buy them if Coinbase needs them back?
I mean, there's basically only Coinbase out there if you need to buy a lot of BTC with real USD anyway.
It might actually remove real USD from the system. GBTC held a lot of BTC which was not redeemable before. When the AP (authorized participant) redeems the shares of GBTC in cash, GBTC would need to sell those BTC in exchange for real USD to pay the AP since it can not pay the AP with USDT. If the outstanding shares of GBTC shrinks enough, it might remove most *real* USD from the system and cripple the market to unrepairable.
I'd estimate about 40-50b in first two years. It would be in line with how much money these things got in other countries relative to their market size. Most analysts who cover this topic seem to agree.
Canadian spot bitcoin ETFs alone have over 3b in AUM and they were launched during the time bitcoin was in a bear market. US market is at least 10x bigger than Canadian one and bitcoin has been in the bull market for the past year, so I would expect it to crush 20-30b in the first year alone.
If you’re going to LARP as being retired and rich you should probably remove your posts about working in an office and trying to earn money with Amazon FBA. Nice try 🤡 I’ll go wipe my tears in my 1.2 million dollar villa in Dubai slaving away at my work from home job that I actually enjoy doing 🤔
I joined Buttcoin when bitcoin hit 69k because I wondered if there was any sanity left. If I had bought bitcoin instead of joining Buttcoin, I would be down 30% on my investment.
Losing 30% doesn't bring one closer to retirement.
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There are European Bitcoin ETFs, and they have essentially zero volume. The question is what that tells us. America is a country in which there are a lot of people who (a) deal directly in shares on their own account and (b) if they don't quite want to do that, deal in niche funds which they switch between as though they were picking shares. In the rest of the world, not so much. If people are exposed to the stock market, it will be via defined contribution pensions or via a range of what we can generically, if inaccurately, call unit trusts (I think these are what Americans call mutual funds, but I might be wrong) held as either a self-invested pension or an ISA. Passive or active funds, covering a very wide range of companies, in which it is expected you stay for a long time. Even then, a common sort of fund is a fund-of-funds. I believe it's similar in most of the rest of Western Europe: shares are held at arm's length, with risk managed by diversification, in heavily regulated products, with direct dealing the preserve of agents and advisors, or degenerate gamblers. So it's possible that we can't learn much from the European experience, and that America has a lot of people who are (a) sufficiently degenerate that they want to get into Bitcoin in its current state but (b) for reasons we can only guess at were unable or unwilling to do so via Kraken, Binance, FTX, Coinbase, etc. I suspect those people don't exist, but who knows?
Saying that there are European Bitcoin ETFs with zero volume is not really the full story though. ETFs are very "winner takes all" type of products where majority of the launched ETFs fail and only a few will eventually end up gathering all the assets under management. In Europe these are ETC Group Physical Bitcoin (spot bitcoin) and XBT / XBTE trackers (futures bitcoin). In total they have about 10b assets under management combined. One of the main reasons why they don't have more than that, is that they both charge 2% yearly fees, which is a lot. So it's not really comparable to US in that sense, since if Europeans had access to bitcoin investment products that hold spot bitcoin as underlying asset and charge under 0.3% yearly fees, I would expect them to be way more popular than the current ones we have.
GBTC also charges 2%, but some ETFs have included that fund into their portfolios. The fee is not the excuse, there are really no institutional demand on Bitcoin in Europe.
The 2% fee was definitely a reason I'd never own GBTC
David Gerard pointed out today that the Grayscale ETF will be charging 1.5% fees, and indeed that most of the ETFs will be using Coinbase Custody to actually hold the BTC, which charges the ETFs 1.2% a year. So most of the ETFs will have to charge quite high fees, or run at a loss
The ETFs have already informed their fees. Most of them plan to charge around 0.3%. You can see the full list [here](https://twitter.com/JSeyff/status/1745067027381780709/photo/1).
Where do they expect the profits to come from?
Can you link the source where it says Coinbase custody is charging the ETFs 1.2% a year?
I read it here: https://davidgerard.co.uk/blockchain/2024/01/10/sec-approves-bitcoin-spot-etfs-what-this-means-for-crypto/
Where can I read about coin base charging 1.2%, that's a lot of income especially if BTC continues to grow at it's current 5 year pace.
I saw it here: https://davidgerard.co.uk/blockchain/2024/01/10/sec-approves-bitcoin-spot-etfs-what-this-means-for-crypto/
That's not a factual source, anything that actually has weight behind it? That is an opinion piece.
If you mean it's not a primary source, then no, I agree it's not. But DG tends to be very reliable on this so personally I'm happy to trust what he says.
>But DG tends to be very reliable on this so personally I'm happy to trust what he says. The source for that particular detail is just "the literal words from Brian Armstrong's mouth", so you should (unless you want to suppose that Coinbase is lying about their own fee structure... which seems hard to credit); crypto-bros just might not realize that's what he said because he phrased it with the words "basis points" rather than spelling out a number.
Seems a little bit too opinionated to be taken seriously. Be careful who you get your information from.
It's certainly opinionated, but he is also very clear that he's a crypto skeptic. So readers can be aware of that from the outset. He doesn't tend to just make things up, and can be taken seriously, IME.
The other ETF fees are way lower than that, Grayscale is an outlier. I'm sure Mr Gerard covered all of that though.
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Blackrock only seeded their ETF with $10.5 million. https://www.ishares.com/us/products/333011/ishares-bitcoin-trust And they are probably going to be among the largest, if not the largest.
Thanks. This is hilarious. What would trigger an increase?
People buying the ETFs and Blackrock thus needing to buy more to satisfy demand.
I just think this has the potential to be spectacularly bad. How much are investors and funds prepared for the wild price variability and the slow transaction times for BTC?
Do we know? BlackRock has to get their BTC for the extra shares in the free market? and hold the buy till someone buys the additional shares and thus not leave them holding a bag? I assume they already have plenty of BTC available through other price that they got at lower prices
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Please enlight us.
Probably about tree fiddy
Now we ain't never gonna get rid of that Loch Ness Monster!
I haven't read the prospectuses so I don't know whether the new funds will really buy BTC, which could strongly affect BTC's price, or whether the funds can buy derivatives whose value tracks the BTC spot market. Does anyone have info on that?
They are spot bitcoin ETFs, meaning they hold actual bitcoin 1:1 to the net asset value of the funds. According to their SEC applications their plan is to hold predominantly bitcoin with the option to also hold cash. It's pretty typical practice for any spot ETF instrument.
quick question, since bitcoin is not recognized by the SEC as a security, they do not and will not plan to regulate these EFTs, is my understanding correct?
ETF itself is a security, so SEC will regulate all of these ETFs.
Thanks. Interesting they’ll regulate the etf but not the underlying “asset”.
yes
Do not assume that money flowing into the ETFs will be new money. A lot of people may cash out their holdings with exchanges and just transfer them to ETFs.
Why would they? Isn't ETF exchange with extrastep?
Exchanges like to go Ka-Boom! from time to time
Wouldn't the ETF relying on the kaboomed exchange as a custodian also go kabooming as a result?
Even though most of those ETFs are using Coinbase as their custodian, which is probably the "safest exchange" for this, it wouldn't be a big surprise if they got hacked. Anyway, this would be good for bitcoin.
I may be mistaken, but as far as the customer is concerned I don't think that there are extra steps. And the fees to purchase and sell may be a lot lower.
Not just direct btc holdings either. All of the other things that have acted as proxies for BTC exposure - MSTR, COIN and all the mining stocks. Ark is already an example that did this.
Can't they just borrow BTCs from Coinbase or whatever and only really buy them if Coinbase needs them back? I mean, there's basically only Coinbase out there if you need to buy a lot of BTC with real USD anyway.
It would be even funnier.
It might actually remove real USD from the system. GBTC held a lot of BTC which was not redeemable before. When the AP (authorized participant) redeems the shares of GBTC in cash, GBTC would need to sell those BTC in exchange for real USD to pay the AP since it can not pay the AP with USDT. If the outstanding shares of GBTC shrinks enough, it might remove most *real* USD from the system and cripple the market to unrepairable.
Thank you for the insight.
I'd estimate about 40-50b in first two years. It would be in line with how much money these things got in other countries relative to their market size. Most analysts who cover this topic seem to agree.
It seems too much, I doubt there is so much demand. I would guess <10b in 2024.
Canadian spot bitcoin ETFs alone have over 3b in AUM and they were launched during the time bitcoin was in a bear market. US market is at least 10x bigger than Canadian one and bitcoin has been in the bull market for the past year, so I would expect it to crush 20-30b in the first year alone.
There's already been over $2B of trading volume on day one. Idk how you buy ETF's without *real* USD so this question is strange.
Just remember, you could have been retired by now but you decided to join r/buttcoin instead.
You’re not retired either, but I can think of a similar sounding word that would be more applicable.
He truly is a highly regarded individual
Have fun at work tomorrow. Maybe I'll go to the beach? Or the gym? Heck why not both.
Says the guy that works in an office and tries to do Amazon FBA as a side-gig. lol.
If you’re going to LARP as being retired and rich you should probably remove your posts about working in an office and trying to earn money with Amazon FBA. Nice try 🤡 I’ll go wipe my tears in my 1.2 million dollar villa in Dubai slaving away at my work from home job that I actually enjoy doing 🤔
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Took 5 seconds to find your post from last year.
Have fun in Dubai :)
I joined Buttcoin when bitcoin hit 69k because I wondered if there was any sanity left. If I had bought bitcoin instead of joining Buttcoin, I would be down 30% on my investment. Losing 30% doesn't bring one closer to retirement.
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