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SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

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Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#201

Post by gregshap »

dnautics wrote: post #131
gregshap wrote: post #66

So what are the expected benefits of a bitcoin ETF? Many of the traditional benefits of ETFs are obsolete when you can just buy and hold an equivalent amount of bitcoin The biggest benefit I can think of is that some institutional investors have restrictions on the types of securities that they can buy. Someone could solve this by creating a company to buy lots of bitcoin, and then having an IPO to list that company…

> Someone could solve this by creating a company to buy lots of bitcoin, and then having an IPO to list that company on a public market. Then pension funds would be allowed to buy it, Jane Doe could buy some in her IRA, etc. You're repeating yourself. That is more or less what an ETF is.

Got it thanks, that makes sense. I guess I was expecting this proposal to somehow be more complicated, and didn't realize that the bar is this high for listing a company thats a bucket of X holdings.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#202

Post by ThrustVectoring »

choxi wrote: post #164

Could someone explain what a Bitcoin ETF is? My understanding is that ETFs are like index funds, which group other stocks into one basket. There's only one Bitcoin though, so what would a Bitcoin ETF collate? The "Description of the Proposal" didn't really make that clear to me.

ETFs group arbitrary assets into something that can be traded like a stock. So the closest comparison would be something like a gold ETF, which lets you buy and sell something like you would a stock with gold's approximate price. A Bitcoin ETF would let you buy and sell something like you would a stock with Bitcoin's approximate price.

It's basically a wrapper class that lets people interact with things as if they were stocks.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#203

Post by LyndsySimon »

sanswork wrote: post #198
ajmurmann wrote: post #197

Earlier quoted context omitted.

Not the parent, but what's going on right now in Venezuela speaks to this nicely: http://www.econtalk.org/archives/2017/02/turning_sociali.htm...

First up the government there have already started arresting the mining operators so probably no longer looking like that wise of an investment on their parts. Other than that it's a much safer bet in Venezuela to buy USD than bitcoin though and that is generally what happens. If you're poor in a country with a government like the Venezuelan one betting your limited funds on a speculative investment that requires an…

> Other than that it's a much safer bet in Venezuela to buy USD than bitcoin though and that is generally what happens.

How?

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#204

Post by srssays »

dragonwriter wrote: post #96
paulpauper wrote: post #40

Earlier quoted context omitted.

it's much more liieky a country will default or fal ito chaos (5 countries nearly did in 2011 during the European debt crisis) than the internet suddenly ceasing to exist or being broken up.

> it's much more liieky a country will default or fal ito chaos (5 countries nearly did in 2011 during the European debt crisis) than the internet suddenly ceasing to exist or being broken up. There are countries for which that may be true, but there are other countries with currency to hedge against those events.

When bad things happen, sometimes capital controls are introduced. This may restrict the ability for people in that country to purchase foreign currencies. Even in developed countries such as Iceland.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#205

Post by LyndsySimon »

ajmurmann wrote: post #197
sanswork wrote: post #182

Earlier quoted context omitted.

This is a non-answer. >There were capital controls restricting more than 100 euro worth of withdrawals from banks per day. Yes and bitcoin didn't help this since the ways to get cash for your bitcoin involved international transfers which exposed you to those restrictions. >Sure it's not helping you if you are buying a coffee but if it's saving parts of your pension that you worked your whole life to earn then it bec…

Not the parent, but what's going on right now in Venezuela speaks to this nicely: http://www.econtalk.org/archives/2017/02/turning_sociali.htm...

I sent someone in Venezuela about USD 40 in Bitcoin in October or November. They were able to convert half of it into more local currency (Bolivares?) than they made in a month at their full-time job.

He said physical US currency was at a huge premium in the country because there wasn't nearly enough of it to go around, and the official exchange rate was clown shoes.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#206

Post by sanswork »

LyndsySimon wrote: post #203
sanswork wrote: post #198

Earlier quoted context omitted.

First up the government there have already started arresting the mining operators so probably no longer looking like that wise of an investment on their parts. Other than that it's a much safer bet in Venezuela to buy USD than bitcoin though and that is generally what happens. If you're poor in a country with a government like the Venezuelan one betting your limited funds on a speculative investment that requires an…

> Other than that it's a much safer bet in Venezuela to buy USD than bitcoin though and that is generally what happens. How?

Black market currency exchanges if you need to convert otherwise you just take payment in USD only and basically treat it as your currency instead of the Bolivar.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#207

Post by jtlien1 »

Something useful like bitcoin etf gets rejected. But look at some of the stocks that are allowed to trade... Magnegas for example has been an ongoing fraud for 17 years. Fake delivery of machines to Kazahkstan. It would be easy to prove this a fraud but the SEC does not care.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#208

Post by jtlien1 »

Something useful like bitcoin etf gets rejected. But look at some of the stocks that are allowed to trade... Magnegas for example has been an ongoing fraud for 17 years. Fake delivery of machines to Kazahkstan. It would be easy to prove this a fraud but the SEC does not care.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#209

Post by Spooky23 »

mrb wrote: post #165
Analemma_ wrote: post #100

Earlier quoted context omitted.

Yup. Any "currency" that can plummet in value by 25% because of a minor SEC ruling is not ready to be a store of value.

You must be unfamiliar with financial markets. Many assets have lost 25% in minutes and still considered perfectly acceptable store of value: stocks, commodities, etc.

Few viable currencies do so.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#210

Post by [deleted] »

gregshap wrote: post #66

So what are the expected benefits of a bitcoin ETF? Many of the traditional benefits of ETFs are obsolete when you can just buy and hold an equivalent amount of bitcoin The biggest benefit I can think of is that some institutional investors have restrictions on the types of securities that they can buy. Someone could solve this by creating a company to buy lots of bitcoin, and then having an IPO to list that company…

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