741–750 of 1001 posts
So bitcoin became something like money and stocks, just a number in a SQL database? And we can now finally make bitcoins out of thin air? How long before the amount of bitcoins traded by hedge funds will be larger than the amount of bitcoins that exist in the actual bitcoin network?
If they fractional reserve too much then they risk going bust as they can't just print more bitcoin in the event of a bank run. Just like the good old days before central banking.
My prediction is that Bitcoin will become fully institutionalized within twenty years, to the point that the “Bitcoin” held by investors are entirely disconnected from the theoretical blockchain. A similar thing happened with stocks. Not so long ago they used to be physical pieces of paper. You could trade shares peer-to-peer and even anonymously by handing over the share certificate to someone in person. For dividen…
I won't argue what is going to happen. I do think if bitcoin were to go this way it would lose most of its fundamental value. As border restrictions, sanctions, KYC, tracking are all applied to the institutional coin, there would be little advantage in comparison to other instruments which generate yield or are more liquid. In such a world the demand for a truly sovereign bitcoin would still exist, although using it…
It is already strongly headed this way. I have recently seen an auction by the respected house (Sotheby's? maybe) that was heavily marketed as the first one with crypto currencies accepted.
Turns out, as it is customary with marketingspeak, in their terms and conditions they mean something entirely else: payments are only accepted from a couple of US crypto exchanges. So, no blockchain and no crypto at all.
Is there any guarantee that if this goes wrong (let's say ETF's are hacked and lose their BTC) then assets in other ETF's are safe? Let's say BlackRock ends up on the hook for billions after their BTC ETF goes wrong. Are my shares in iShares NASDAQ 100 ETF safe? I want to make sure I don't have any exposure to crypto world by owning stock ETFs. If there is any scenario that I am on the hook for crypto nonsense going…
I know nothing about the legal vehicles used for US domiciled ETFs, but I would assume the situation is the same.
Talk to a financial advisor before making decisions based on this information.
My prediction is that Bitcoin will become fully institutionalized within twenty years, to the point that the “Bitcoin” held by investors are entirely disconnected from the theoretical blockchain. A similar thing happened with stocks. Not so long ago they used to be physical pieces of paper. You could trade shares peer-to-peer and even anonymously by handing over the share certificate to someone in person. For dividen…
The difference is that they can never stop you custodying the bitcoin yourself. Bitcoin won't become "quaint" - it will always sit there as the hardest money mankind has ever seen (and likely ever will). If they try and create tokens that don't represent bitcoin i.e. creating them out of thin air, then they will go down in value relative to bitcoin, just as we are seeing with fiat currencies and people will move thei…
They can and will stop you from actually using real bitcoin stored onchain. It's a strong trend and one that is quite troubling.
Earlier quoted context omitted.
Bitcoin equalises this. USD is going to hyper-inflate to 0 relative to bitcoin, and bitcoin will ultimately be the world reserve asset.
And mostly all in the pockets of a few whales.
I will never understand how people fault crypto for not somehow magically solving the world's financial ills, as if humanity has ever had another (successful) plan for wealth distribution. How's that communism working out?
Crypto is meant to solve the trustless distributed ledger problem, nothing more, nothing less. Expecting human nature to somehow change because of this technology is ridiculous.
Earlier quoted context omitted.
> and you think Bitcoin will go to zero AFTER its available to every investor in the US through every finance app and is being sold by giant hedge funds? The reasoning is (I'm not saying I believe this will happen just that it is an interesting thought experiment) that if people quit the shady exchanges and start trading Bitcoin ETF in substantial numbers it could begin to starve the crypto network of transaction fee…
Why would ETFs become a main way? Bitcoin is still a currency, can I trade, holdl or spend my ETFs?
About 70% of the S&P 500 stocks are held by mutual funds or ETFs rather than individually held.
If you trade stocks and would like to buy bitcoin (as an investment) are you going to do it with an ETF through your broker where the money is protected fairly well by law and insurance, or manually and make sure you don't loose it, or through an unregulated crypto exchange?
Use of Bitcoin as a currency (for buying things) has dropped from 57% in 2019 to 32% in 2023, the rest is speculation and inter exchange transfers
My prediction is that Bitcoin will become fully institutionalized within twenty years, to the point that the “Bitcoin” held by investors are entirely disconnected from the theoretical blockchain. A similar thing happened with stocks. Not so long ago they used to be physical pieces of paper. You could trade shares peer-to-peer and even anonymously by handing over the share certificate to someone in person. For dividen…
Ignore this at your peril.
My prediction is that Bitcoin will become fully institutionalized within twenty years, to the point that the “Bitcoin” held by investors are entirely disconnected from the theoretical blockchain. A similar thing happened with stocks. Not so long ago they used to be physical pieces of paper. You could trade shares peer-to-peer and even anonymously by handing over the share certificate to someone in person. For dividen…
The difference is that they can never stop you custodying the bitcoin yourself. Bitcoin won't become "quaint" - it will always sit there as the hardest money mankind has ever seen (and likely ever will). If they try and create tokens that don't represent bitcoin i.e. creating them out of thin air, then they will go down in value relative to bitcoin, just as we are seeing with fiat currencies and people will move thei…
Earlier quoted context omitted.
The possibility of change exists, but one of the hardest promises Bitcoin makes is that you can't change the rules mid-game like what happened with stocks. That is one of the most attractive things about this asset class - if the US regulators want to change how a crypto is traded ... tough biscuits. They have to convince the market participants, globally, to trade the new way. The bar might be orders of magnitude hi…
Doesn't the ETF completely bypass such rules? Now you aren't trading actual Bitcoin -- you're trading entitlements at the DTC, managed on their own settlement system and centralized databases. All you need to do is look into RegSHO to see all the ways that system can be gamed.
Earlier quoted context omitted.
Aren't the vast majority of market participants already operating outside the blockchain, relying on exchanges and sometimes on so-called "L2" networks like Lightning? I think the majority of Bitcoin and Ethereum proponents are already talking about them as "digital gold" instead of digital currency. The mining pools have also blocked any attempt to make the Bitcoin blockchain more efficient at transactions (by keepi…
While you're right that Lightning L2 transactions generally aren't published on the blockchain, while following the lightning protocol, real Bitcoin transactions are passed between network participants that can be published by any of the participants if another other party doesn't follow the lightning channel rules.