The rumors are true, a Spot Bitcoin ETF is coming early next year.
The good news is it’s not here yet. So, you have time to catch the first waves and buy self-custody bitcoin before the stampede begins.
Bitcoin is going mainstream. It is Inflation-proof. And every money manager with a pension fund on their balance sheet wants in.
Here’s why a Spot Bitcoin ETF is so eagerly anticipated in 2024.
Why Financial Institutions Want A Spot Bitcoin ETF
Financial Institutions want a Spot Bitcoin ETF because there’s a growing concern that their traditional 60/40 portfolio (60% stocks and 40% bonds) may no longer hold true in the current market condition.
With the changing economic landscape, many investors are demanding exposure into the crypto asset for its low correlation with traditional assets like stocks and bonds.
This would be a valuable tool for portfolio diversification. Adding a small Bitcoin allocation could potentially enhance risk-adjusted returns for investors.
Overall, the approval of a Spot Bitcoin ETF could potentially mean exposure to a mainstream crowd for wealth allocation.
When that day comes, the top 1% most wealthy will hold 0.87 BTC (assuming just a 5% allocation). That’s how little of it there is to go around.
Just look at the visual below. It’s a wide-open opportunity.
What is an ETF?
An ETF (Exchange-Traded Funds) is a fund that contains one or more assets. Buying a fund share gives an investor the right to own a share of the fund’s assets. Thus, by investing in one fund, they can hold an entire asset portfolio. In this case, technically, investments are not direct — the trader isn’t buying the assets themselves, only ETFs.
ETFs are bought and sold on a stock exchange – in much the same way as stocks. They perform a similar function to indices, investment trusts and other exchange traded products.
You can buy an ETF to track a sector, an index, stocks from a specific country, a commodity, a currency or fixed income markets.
ETFs emerged out of the index investing phenomenon in the late 1980s and early 1990s.
Since then, ETFs have quadrupled in size and is responsible for dramatically transforming the entire financial landscape.
To give you an idea about the adoption of technology since 2009, Smartphones has a compounded annual growth rate of 24.3% while ETFs – 18% while Social Media at 13%.
According to Statista, the global exchange traded fund (ETF) market’s assets under management (AUM) reached almost 10 trillion U.S. dollars in 2022, more than double from 4.6 trillion U.S. dollars in 2019.
The number of ETFs worldwide also grew from 276 in 2003 to 8,754 in 2022.
ETFs became a popular investment vehicle because it provided several important benefits to investors:
- Low cost
- Liquidity
- Diversification
- Tax Efficiency
- Operational Efficiency
- Accessibility
- Transparency
- Flexibility
What is a Spot Bitcoin ETF?
A Spot Bitcoin ETF is an exchange-traded fund consisting solely of BTC being held in the accounts of the ETF fund’s issuing company.
It’s crucial to understand the fundamental difference between the futures-based Bitcoin ETFs available now and the hypothetical ‘Spot Bitcoin ETF‘ which, if approved, would hold actual Bitcoin (BTC).
Usually, ETFs only take their price from futures contracts and are synthetic in nature rather than containing the physical commodity. So, a Spot Bitcoin ETF offers a more direct and efficient way of accessing the Bitcoin market.
Now, the question is “Is a Spot Bitcoin ETF right for you?”
Q: “Why Are Investors Waiting for a Spot Bitcoin ETF?”
The Spot Bitcoin ETF is eagerly awaited in the USA because it will solve a series of problems faced by institutional investors who are hungry for Bitcoin exposure.
What a Spot Bitcoin ETF brings:
- Increased trust in BTC and cryptocurrency in general;
- A suitable solution for corporations with conservative investment strategies, accustomed to the ETF format;
- Minimization of complexity and security risks associated with direct Bitcoin holding.
The introduction of a Spot Bitcoin ETF could reshape cryptocurrency and financial markets. ETFs, in general, have significantly impacted trading by increasing volume and liquidity.
A spot Bitcoin ETF can also contribute to the widespread recognition of crypto and the rise in BTC prices.
Is a Spot Bitcoin ETF right for me?
I answered that question on your behalf. Now, the question isn’t so much whether a buying a Spot Bitcoin ETF is right for you, but whether it is in your best interest to buy one from one of these Spot Bitcoin ETF issuers:
– BlackRock
– Fidelity
– Franklin Templeton
– WisdomTree
– ARK 21Shares
– Invesco/Galaxy
– Valkyrie
– VanEck
– Bitwise
Let me explain…
Bitcoin aren’t all created equal. They aren’t all the same.
When you’re buying an ETF product, you’re simply relying on an electronic record privately held by your brokerage company. You’re trusting some third party of a third party middle-man to custody the BTC, which in this case, seems to be Coinbase…yes that crypto exchange will be the primary custodian for *ALL* of these ETFs’ products.
Is it not a gigantic honeypot waiting to be hacked?
Remember FTX? Remember Mt. Gox all those years ago?
Are we forgetting history again?
So it’s important to assess your investor profile in order to determine which method would be the perfect fit for you.
Consider how much money you’re willing to dedicate towards building your bitcoin portfolio.
If flexibility and ownership is what you’re seeking, you will find no such thing with a Spot Bitcoin ETF.
There are a better ways to buy and Hodl bitcoin:
- What Would Happen If You Bought $100 of Bitcoin Every Month For Six Years?
- 6 Best Ways to Set Up Automated Recurring Bitcoin Purchases
- 12 Best Bitcoin Wallets You Should Use to Secure Your Crypto Assets
This will give you flexibility and freedom (beyond location).
Think about when you want to move to another country. Nothing holds you hostage indefinitely. That’s how powerful the idea of Bitcoin is to self-sovereignty.
Bitcoin is not just another ETF product designed to be a plaything for Government control.
Here’s an example of what happened in the past when gold was subjected to a nationwide confiscation…
I think there’s a >50% chance that #Bitcoin left with Coinbase and/or the spot ETFs will get 6102’d by the US government.
They stole custodial gold why wouldn’t they steal custodial bitcoin?
The status-quo is theft by the state.
I doubt that changes.
Hold your own keys. 🔐 pic.twitter.com/ESEL2cUQd1
— Mitchell 🇺🇸🚀 (@MitchellHODL) December 26, 2023
Something to ponder about.
Conclusion
There is going to be a huge Bitcoin bull run anticipation in 2024 especially because of the Spot Bitcoin ETF approval coinciding with the Bitcoin Halving Event in April.
If the ETFs are approved in January, it is going to cause a massive wave of Spot Bitcoin ETF marketing led by the likes of Blackrock as they outcompete with each other for long term client acquisition.
In fact, early reports indicate that a Bitcoin Spot ETF fee war is already happening, with Fidelity offering a Bitcoin ETF fee of just 0.39% whileGalaxy/Invesco offer Zero fees for first 6 months 👀
We have never seen this kind of marketing blitz for Bitcoin to the general public before. I guess they just realized the compound growth on fee’s over a 2 decade stretch as Bitcoin price appreciates is going to be insane and are willing to lead with a loss now to acquire the clients now!
The race to the fee bottom for customers has only begun.
But if you want to focus on producing the big results for yourself, focus on the ones below.
→ Download our Essential Sovereign Living Content for 2024 here: https://thinkmaverick.gumroad.com
It should move the needle for you and drive more results.
Talk soon!
READ NEXT:6 Best Ways to Set Up Automated Recurring Bitcoin Purchases
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