The first American Bitcoin ETF was launched earlier this week on Wall Street. Long-awaited, this first ETF was a great success, to say the least!
The ProShares Bitcoin Strategy Fund ETF, based on Bitcoin futures contracts, was the second-largest traded ETF in the market by volume on its first day of trading. No less than $570 million in invested assets for just over $1 billion in trading, in a single day of trading.
It is an understatement to say that American retail investors rushed to buy this ETF.
Given the phenomenal Q4 2021 that awaits Bitcoin, it makes sense that American investors would want to get in on the fun. The approval of this first Bitcoin ETF in America is overall good news. Others will follow, but for the time being, the first ETFs to be offered to investors are not based on “physical” Bitcoin, i.e. based on the spot market.
The final verdict that will be given on November 14, 2021, to VanEck for its spot-based Bitcoin ETF is in my view an even more important deadline. Optimism is not necessarily warranted when one remembers the reticence expressed repeatedly in recent months by SEC Chairman Gary Gensler about spot-based Bitcoin ETFs.
We’ll see what happens.
In the meantime, more and more investors from the traditional markets will come to take exposure to Bitcoin via these ETFs. While it is a good thing for an investor to take an interest in a monetary revolution like Bitcoin that will change the world of the future for the better, I will once again repeat what I have said in the past.
As an individual, your primary interest is in buying Bitcoin directly on the spot market.
To fully understand why you need to go back to the core meaning of the Bitcoin revolution. While the price of Bitcoin has been rising steadily since its inception, you should not fall into the trap of thinking that it is just another financial investment.
Bitcoin is more than just an investment. Bitcoin is all about power. Bitcoin is about giving you back the power over the fruits of your labor. It’s a major paradigm shift that Bitcoin is offering you.
To benefit from all that Bitcoin has to offer, you must decide to take responsibility for the security of your wealth yourself. If you make this choice, then no one will be able to censor your transactions or confiscate the fruits of your labor.
By buying exposure to Bitcoin via ETFs, you will be able to protect yourself in part from the ravages of monetary inflation that we have been facing for decades. Unfortunately, you’ll be stuck with the problems of the current system in terms of securing the fruits of your labor.
You will not be able to use your money as you wish at any time. You may have your wealth confiscated as a result of arbitrary decisions made by powerful people in charge of the current system.
Only part of the problems of the current system will be solved for you. Bitcoin will help you solve all the problems that the current monetary and financial system faces. So this is a fundamental difference that you need to keep in mind.
It’s no coincidence that all Bitcoiners constantly repeat the same rule:
“Not your Keys, Not your Bitcoin.”
You only own the Bitcoin you have the private keys associated with. It’s as simple as that. With Bitcoin, you have the luxury of being able to take direct ownership of your money without needing to put blind trust in any institution or arbitrary rules set by powerful people who often don’t even respect them themselves.
The best exposure to Bitcoin will always remain the same: a direct purchase on the spot market with cold storage. This will ensure deep safety as opposed to the shallow safety that the current system offers.