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Cryptos: 2,073
Market Cap: $103,625,484,500
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BTC Dominance: 54.9403 %

What is a Bitcoin ETF? - Guide For Beginners

2 months ago

Ever since the emergence of the popular cryptocurrency, Bitcoin is being implemented for replacing traditional investment vehicles and optimized for becoming a payment solution, which rivals the likes of Visa or MasterCard!


What is a BTC ETF?


Relatively speaking the price of a Bitcoin was set and assumed at a hundred millionth of a cent, or so to speak, contrary to the whitepaper and forums where the price has been set and speculated upon, Bitcoin rose to levels no early adopter would even dare to think about. Bitcoin has raised from $0.1 to $6000 currently! And the massive spike which caused it to go even further up the price was in December of last year which shocking garnered upto $20,000 a coin!


This spike piqued the interest of no-coiners and stock traders looking to leverage the volatility to earn massive profits. Much to their dismay, Bitcoin was not a legal entity and it’s decentralized core made it difficult for the regulatory authorities to control the massive surges of prices.

Enter ETF

ETF (exchange-trade platforms) are like normal exchanges from where stocks can be bought and sold with higher liquidity and very minimal fees, this is very beneficial for an individual investor that requires an alternative to mutual funds. All of the indexes of the trades are tracked by the relevant authorities.

Bitcoin with the ETF

The ETF will monitor and mimic the known price of the digital asset and would remove the hassle for an ordinary investor.

Benefits

  • Self Trading

  • Security

  • Storage

  • Profits/Losses

  • Fees

Regulation

The only thing stopping these investors is the barrier of entry by the SEC, they believe that trading assets with huge store of values on largely unregulated exchanges make it susceptible to fraud and manipulation.


There has been efforts by the cryptocurrency enthusiasts, The Winklevoss twins, who created the ‘Gemini’ exchange got rejected from the SEC, but in turn were awarded a patent for digital trade products.

Timeline

The SEC is not yet regulating any ETF proposal, but the probability is much more higher at this stage due to interest from traditional investors. At this point, speculating the uproar and the market, it is much more likely to gain traction in price with minimal problems or “drama” compared to Bitcoin Futures.


We at CryptoCrawl believe that proposals like these would interest many investors and would likely spin up a new generation of seasonal investors, also driving real adoption towards cryptocurrencies, which is a win-win situation combined.