Effects of Bitcoin ETF on Crypto Investments!
By Space Coast Daily // February 14, 2022
Because cryptocurrency investors have a massive demand for the diversification of portfolios, many digital assets have already gained significant prices. Many cryptocurrency investors are nowadays looking forward to investing in different alternatives. They want to hold their money in cryptocurrencies’ birthday simultaneously; they also look for alternative methods.
It is to diversify their portfolio to safeguard themselves from the risk of the downfall of cryptocurrencies. It has led to the evolution of different crypto coins and some NFTs. Due to the surge of these digital coins and NFTs, the market is flooded with alternatives for cryptocurrency investors.
There have been multiple latest developments in the cryptocurrency space. Actively, people can predict the future of crypto coins because of these alternatives.
One such significant development in the world of crypto space has been taken up by the allowance of securities exchange commission for the first future based bitcoin futures exchange-traded fund. Yes, it was the first ETF based on bitcoin and was traded on Wall Street. It is one of the biggest news for cryptocurrency investors for several reasons. The reasons are as follows–
1. First of all, there are multiple cryptocurrencies in the world like bitcoin and ethereum, along with some NFT, and they are becoming mainstream alternatives from the traditional investment options. They are incredible for diversifying your portfolio, and therefore, the new bitcoin ETF opens up new options.
2. With the evolution of new ETF from the bitcoin network, the cryptocurrencies will get more legitimacy, and there will be a better option for alternative investment.
3. With the widespread promotion of the new bitcoin ETF, people will get more awareness about how to invest in cryptocurrencies and what cryptos can give them. Therefore, people will potentially get attracted to cryptocurrencies, leading to a further rise in prices of different points.
Even though everyone who is a supporter of bitcoin ETF is praising the same, there are specific reasons because of which many of them believe that it lacks its most important function. At this point, the bitcoin ETF can only be used to track the future performance of bitcoin. However, we can never be sure if you hold the bitcoins in your hands. By investing in the bitcoin ETF, you are not selling the stake in the fund. However, you will just predict the future, and therefore, this investment can be much riskier than bitcoin itself.
Some of the critics of bitcoin ETF wanted a fund to physically trade bitcoins and track the availability and use them to store in a crypto wallet. On the contrary, the bitcoin ETF stands as a highly liquid asset available in the market 24 x 7. The bitcoin ETF does not allow cryptocurrency investors to use it just like bitcoin. They can purchase it or sell it, but they cannot store it in their wallet. If they want to do so, they can purchase a subscription to a crypto wallet and purchase whatever cryptocurrency they want.
Earlier, the securities exchange commission was not allowing any cryptocurrency ETA for years because it believed bitcoin to be highly volatile. However, one of the most important reasons it rejected any ETF proposal was that the owner could not prove that it could protect the investors from market resistance and manipulation.
Therefore, it has been in a proposal for years to bring about an ETF but was declined. However, now, it is stated that the securities exchange commission is trying to protect cryptocurrency investors with better regulation and oversight on the thousands of crypto assets that are emerging, and you can join today for free. If you are interested in bitcoin trading, visit https://q-profit-system.com/.
Therefore, it is yet to be seen if the new bitcoin ETF will ultimately help cryptocurrency investors or hurt them to a large extent. According to some cryptocurrency experts, the new bitcoin ETF is tied to cryptocurrencies. Therefore, it is going to open many doors for cryptocurrency investors.
Also, people are just informed about its emergence, and they are not sure how they want to use it. Therefore, they can potentially hold this bitcoin ETF just like the cryptocurrencies and NFT. However, with the evolution of the new bitcoin ETF, people will potentially invest in digital assets because it is sure to become more mainstream than other options available in the market. Also, with this one, people will be able to diversify their portfolios easily.