Why Satoshi Nakamoto is Smiling at BlackRock’s Embrace of Bitcoin
January 22, 2024 | by stockcoin.net
The recent approval of bitcoin exchange-traded funds (ETFs) by the SEC has sparked a debate within the cryptocurrency community. While some argue that bitcoin doesn’t need ETFs and that they contradict the concept of decentralization, others see them as a crucial step towards furthering the original mission of bitcoin. In this article, Kathleen Breitman explores why the embrace of bitcoin by financial giants like BlackRock is a positive development, highlighting the potential benefits of ETFs in expanding the market and improving security for everyday users. Ultimately, she suggests that Satoshi Nakamoto, the mysterious creator of bitcoin, would likely be pleased with this new tool to acquire and store his digital currency.
The SEC’s Approval of Bitcoin ETFs
Crypto community’s mixed reactions
The recent approval by the Securities and Exchange Commission (SEC) of nearly a dozen bitcoin exchange-traded funds (ETFs) has sparked mixed reactions within the crypto community. While many see this as a major win for the industry, there are those who are skeptical and express concerns about the need for an ETF for bitcoin.
Bitcoin doesn’t need an ETF objection
One common objection raised by critics is that “bitcoin doesn’t need an ETF.” They argue that the decentralized nature of bitcoin is compromised when intermediaries, particularly those from Wall Street, are involved in purchasing and marketing the cryptocurrency. These critics believe that using an ETF for bitcoin goes against the original mission of the project.
Perceived threat to decentralization
The objection to bitcoin ETFs is rooted in the belief that the involvement of financial institutions, such as BlackRock, perverts the ideal of decentralization. These skeptics believe that relying on intermediaries to trade and hold bitcoin undermines the peer-to-peer nature of the cryptocurrency.
Conspiracy theories and government confiscation concerns
Some individuals take their skepticism of bitcoin ETFs to the extreme. They suggest that financial institutions like BlackRock might conspire to alter bitcoin’s core features for their own benefit. Additionally, some fear that the US government could confiscate the bitcoins held by ETFs. These conspiracy theories and concerns reflect a lack of understanding of how ETFs and bitcoin operate.
Bitcoin as a Store of Value
Bitcoin’s original mission
Bitcoin was originally developed to serve as a peer-to-peer digital cash system. However, over time, it has also become an increasingly popular store of value. Many individuals buy bitcoin as a way to preserve their wealth and protect themselves from economic uncertainties.
ETF strengthens Bitcoin’s case as a store of value
The approval of bitcoin ETFs by the SEC strengthens the case for bitcoin as a store of value. By providing a regulated investment vehicle, ETFs make it easier for investors to gain exposure to bitcoin and hold it as a long-term investment. This accessibility and legitimacy contribute to bitcoin’s reputation as a store of value.
Role of a store of value in personal finance and global markets
Having a secure and reliable store of value is crucial for personal finance and the stability of global markets. Bitcoin’s status as a store of value offers individuals an alternative investment option outside the traditional financial system. Moreover, in countries with unstable economies or authoritarian regimes, bitcoin’s censorship resistance and portable nature make it an attractive store of value.
Bitcoin’s Censorship Resistance and Portability
Bitcoin’s features for global individuals
Bitcoin’s censorship resistance and portability make it an appealing option for individuals around the world. Its decentralized nature ensures that transactions cannot easily be censored or controlled by any central authority. Furthermore, its digital nature allows for easy transfer and storage across borders without the need for traditional banking systems.
Increasing importance of censorship resistance
In an era of increasing government surveillance and control, censorship resistance has become a vital characteristic for individuals seeking financial freedom. Bitcoin’s technology allows users to transact and store wealth outside the purview of any centralized authority, ensuring privacy and security.
Growing use cases due to armed conflicts and capital flight
Bitcoin’s censorship resistance and portability have become even more critical due to armed conflicts and capital flight in various parts of the world. In regions experiencing political and economic instability, people are turning to bitcoin as a safe haven for their wealth. The ability to easily transfer and protect their assets makes bitcoin an attractive option.
Bitcoin ETFs as an Investment Tool
Simpler regulations for holding ETFs
One advantage of bitcoin ETFs is that they fall under existing regulations for holding investment vehicles. This simplicity allows investors to hold ETFs in retirement accounts, such as IRAs or 401ks, with ease. Compared to holding actual cryptocurrencies, ETFs offer a more straightforward regulatory framework, making them accessible to a broader range of investors.
Broadening the market appeal of ETFs
The introduction of bitcoin ETFs expands the market appeal of these investment vehicles. ETFs are a familiar and trusted investment tool for many individuals, including those who may be less tech-savvy or risk-averse. By providing an ETF option for bitcoin, the market opens up to a new segment of potential investors.
Improving security and liquidity for Bitcoin owners
ETFs also offer improved security and liquidity for bitcoin owners. The regulated nature of ETFs ensures that investors can trust the custodians responsible for holding their funds. Furthermore, the liquidity provided by ETFs allows for easier buying and selling of bitcoin, making it a more convenient asset to manage.
Bitcoin ETFs and Liquidity
Saturation of cryptocurrency market by ideologues and gamblers
The cryptocurrency market has thus far been saturated by ideologues and gamblers. Many early participants in the market were tech enthusiasts and libertarian-minded individuals who saw cryptocurrencies as a way to challenge the traditional financial system. While these early adopters played a significant role in the growth of cryptocurrencies, they also made the market less accessible to average investors.
Audited vehicles creating more global liquidity
The introduction of audited vehicles, such as bitcoin ETFs, brings more global liquidity to the cryptocurrency market. This liquidity makes it easier for interested individuals to buy and sell bitcoin without the need for complex security measures or technical expertise. The wider availability of bitcoin through ETFs opens up the market to a broader range of participants, ultimately increasing liquidity.
Easy entry for the crypto-curious
Bitcoin ETFs also provide an easy entry point for individuals who are curious about cryptocurrencies but may not be ready to dive into the complexities of owning and managing digital assets. By offering a regulated and familiar investment vehicle, ETFs make it more accessible for the crypto-curious to dip their toes into the world of bitcoin.
Bitcoin ETFs and Average Investors
Alternative to safety deposit boxes and hardware wallets
Bitcoin ETFs offer an alternative to the traditional methods of storing and securing bitcoin. For average investors, navigating the complexities of safety deposit boxes or hardware wallets may be intimidating or inconvenient. ETFs provide a more user-friendly option for those looking to invest in bitcoin without the need for specialized storage solutions.
Increased participation of average people in Bitcoin
The availability of bitcoin ETFs makes it easier for average people to participate in the bitcoin market. By providing a familiar investment vehicle, ETFs remove barriers to entry and allow individuals who may not have the technical know-how or resources to buy and hold actual bitcoin. This increased participation can contribute to the growth and adoption of bitcoin.
Benefit to Bitcoin believers and users
Bitcoin ETFs not only benefit average investors but also those who believe in and use bitcoin. The increased liquidity and market access brought by ETFs can help improve the reputation and perception of bitcoin as a viable investment and store of value. Additionally, by attracting more participants to the market, the value and utility of bitcoin can potentially increase.
Kathleen Breitman’s background and affiliation with Tezos
Kathleen Breitman, the author of this article, is a co-founder of Tezos, a blockchain platform known for its smart contract functionality. Due to her involvement in the blockchain industry, Breitman brings her expertise and knowledge to the discussion of bitcoin ETFs and their potential impact on the industry.
Opinions expressed in Fortune.com commentary pieces
The opinions expressed in Fortune.com commentary pieces, including this article by Kathleen Breitman, are solely the views of the authors and do not necessarily reflect the opinions and beliefs of Fortune as a publication. It is essential to consider multiple perspectives and conduct further research when forming an informed opinion on the subject matter.
Emphasizing the positive impact of Bitcoin ETFs
In this article, Kathleen Breitman emphasizes the positive impact of bitcoin ETFs on the growth and adoption of bitcoin. She argues that ETFs provide an accessible and regulated investment vehicle for average investors, increasing liquidity and market participation. Breitman believes that the introduction of ETFs aligns with the original mission of bitcoin and contributes to its reputation as a store of value and censorship-resistant asset.
In summary, the approval of bitcoin ETFs by the SEC has sparked mixed reactions within the crypto community. While some express concerns about the need for an ETF and its potential impact on decentralization, others see it as a significant step forward for bitcoin. Bitcoin’s role as a store of value is strengthened by the introduction of ETFs, which provide accessibility and legitimacy to the cryptocurrency. Additionally, bitcoin’s censorship resistance and portability make it an attractive option in an increasingly uncertain world. Bitcoin ETFs offer investors a regulated and straightforward investment tool, improving security, liquidity, and market appeal. The introduction of audited vehicles also brings more global liquidity to the cryptocurrency market, making it easier for the average investor to participate. Bitcoin ETFs provide an alternative to traditional storage methods and allow increased participation of average individuals in the bitcoin market. From the author’s perspective, bitcoin ETFs have a positive impact on the industry and contribute to the original mission of bitcoin. Overall, the future of bitcoin ETFs holds promise for further growth and adoption of bitcoin as a digital asset.