4 ms·

If crypto is “scam”, why Fidelity and Blackrock are trying with ETF?

6 points by OnuRC 3y ago

I thought it was %100 scam and these trillion $ companies can't see it? interesting

BlakeSimpson 3y ago
Because people want it is the short answer. The way these companies see it, if theres a demand and an opportunity to make money, they go for it. Paired with knowing the GOV will always bail them out, it's a no lose situation.
- mkrishnan 3y ago
  Yes, as long as they have an opportunity to make money, they will leverage it.
PaulHoule 3y ago
Bitcoin seems to be for real on some level but the transaction volumes it can handle are anemic. So far Bitcoin ETFs have struggled to track BTC accurately. If transaction costs were low and the market really liquid tracking would be easy (look how well SPY tracks) but it seems Bitcoin ETFs can’t trade efficiently and enough to stay on track. Usually stock ETFs have weekly events where outsiders will trade the assets for new shares of the ETF (or vice versa) which is a low-cost way to track, I don’t know if crypto ETFs do that but it isn’t working.
- hn8305823 3y ago
  > Bitcoin seems to be for real on some level but the transaction volumes it can handle are anemic. Same with physical gold in much of the world today. Different forms of money have different use cases and tradeoffs. > So far Bitcoin ETFs have struggled to track BTC accurately This is only because of the stubborn refusal by the SEC to authorize "full" ETF status for them. The funds that trade today like GBTC are essentially closed-end funds that cannot be redeemed for the underlying asset on a regular basis. That daily/intraday mechanism is what allows full ETF's to track correctly as arbitrage strategies can profit from any significant deviation.
quickthrowman 3y ago
Because there is demand, and they earn fees from managing the ETF with zero exposure to the underlying crypto asset. They might charge 1% per year to manage the ETF which might cost them 50% of that 1%, then the rest is profit. It’s as simple as that, they aren’t taking a directional position, they’re managing a fund and collecting fees.
- _5uxp 3y ago
  "they aren’t taking a directional position yet" Fixed it for you. What exactly making it accesible to trillion $ capital is going to lead? lower price for decades? stable price for fixed supply asset? Just think :)
  - quickthrowman 3y ago
    Headline from today: > SEC says Bitcoin ETF filings are inadequate Sorry for your loss
    - deleted 3y ago
      [deleted]
rvz 3y ago
Finally. Someone questioning the actions of these wealth management companies doing such move instead of endlessly screaming 'crypto is scam' all day long in threads like this. [0] It is a labyrinth of manipulation with the news. It's very important to not listen to the hysterical critics in [0] or the crypto maximalists on social media. BlackRock, Fidelity, etc filed for this AFTER the SEC decided to 'crackdown' and sue Coinbase, Binance, etc (to prepare for FedNow) implying that they wanted to jump in at a much lower price when the crypto market got spooked over the SEC's actions. The people in [0] are dead quiet now after a bunch of these companies filed for those Bitcoin ETFs. Not all of these ETFs will be approved, but these critics are sure waiting for that outcome to happen. The crypto maxis shouldn't get over themselves yet either. One other thing in that I said in [1] notice how as soon as the US runs down the crypto exchanges, China (Hong Kong) does the complete opposite. [2] [0] https://news.ycombinator.com/item?id=36302231 https://news.ycombinator.com/item?id=36302231 [1] https://news.ycombinator.com/item?id=36306757 https://news.ycombinator.com/item?id=36306757 [2] https://www.ubs.com/global/en/media/display-page-ndp/en-20230609-tokenized-notes.html https://www.ubs.com/global/en/media/display-page-ndp/en-2023...
mkrishnan 3y ago
Well, BR & fidelity want to boost their revenues. Their revenue is commission on the trade. they don't care that they are trading as long as they get their commission.

6 points by OnuRC 3y ago

I thought it was %100 scam and these trillion $ companies can't see it? interesting

Because people want it is the short answer. The way these companies see it, if theres a demand and an opportunity to make money, they go for it. Paired with knowing the GOV will always bail them out, it's a no lose situation.

mkrishnan 3y ago
Yes, as long as they have an opportunity to make money, they will leverage it.

PaulHoule 3y ago

Bitcoin seems to be for real on some level but the transaction volumes it can handle are anemic. So far Bitcoin ETFs have struggled to track BTC accurately. If transaction costs were low and the market really liquid tracking would be easy (look how well SPY tracks) but it seems Bitcoin ETFs can’t trade efficiently and enough to stay on track. Usually stock ETFs have weekly events where outsiders will trade the assets for new shares of the ETF (or vice versa) which is a low-cost way to track, I don’t know if crypto ETFs do that but it isn’t working.

hn8305823 3y ago
> Bitcoin seems to be for real on some level but the transaction volumes it can handle are anemic. Same with physical gold in much of the world today. Different forms of money have different use cases and tradeoffs. > So far Bitcoin ETFs have struggled to track BTC accurately This is only because of the stubborn refusal by the SEC to authorize "full" ETF status for them. The funds that trade today like GBTC are essentially closed-end funds that cannot be redeemed for the underlying asset on a regular basis. That daily/intraday mechanism is what allows full ETF's to track correctly as arbitrage strategies can profit from any significant deviation.

quickthrowman 3y ago

Because there is demand, and they earn fees from managing the ETF with zero exposure to the underlying crypto asset. They might charge 1% per year to manage the ETF which might cost them 50% of that 1%, then the rest is profit. It’s as simple as that, they aren’t taking a directional position, they’re managing a fund and collecting fees.

_5uxp 3y ago
"they aren’t taking a directional position yet" Fixed it for you. What exactly making it accesible to trillion $ capital is going to lead? lower price for decades? stable price for fixed supply asset? Just think :)
- quickthrowman 3y ago
  Headline from today: > SEC says Bitcoin ETF filings are inadequate Sorry for your loss
  - deleted 3y ago
    [deleted]

rvz 3y ago

Finally. Someone questioning the actions of these wealth management companies doing such move instead of endlessly screaming 'crypto is scam' all day long in threads like this. [0] It is a labyrinth of manipulation with the news. It's very important to not listen to the hysterical critics in [0] or the crypto maximalists on social media. BlackRock, Fidelity, etc filed for this AFTER the SEC decided to 'crackdown' and sue Coinbase, Binance, etc (to prepare for FedNow) implying that they wanted to jump in at a much lower price when the crypto market got spooked over the SEC's actions. The people in [0] are dead quiet now after a bunch of these companies filed for those Bitcoin ETFs. Not all of these ETFs will be approved, but these critics are sure waiting for that outcome to happen. The crypto maxis shouldn't get over themselves yet either. One other thing in that I said in [1] notice how as soon as the US runs down the crypto exchanges, China (Hong Kong) does the complete opposite. [2] [0] https://news.ycombinator.com/item?id=36302231 https://news.ycombinator.com/item?id=36302231 [1] https://news.ycombinator.com/item?id=36306757 https://news.ycombinator.com/item?id=36306757 [2] https://www.ubs.com/global/en/media/display-page-ndp/en-20230609-tokenized-notes.html https://www.ubs.com/global/en/media/display-page-ndp/en-2023...

mkrishnan 3y ago

Well, BR & fidelity want to boost their revenues. Their revenue is commission on the trade. they don't care that they are trading as long as they get their commission.