/biz/ - Business & Finance

>>57280222
Check ‘em

Please elaborate

>>57280250

The ETFs just promise to pay Bitcoin they never have the Bitcoin most of the time. The ETFs never actually have any Bitcoin than the number of people who try to convert their ETF shares into Bitcoin. The number of people who try to convert their ETF shares to Bitcoin are very few.

>>57280266
They buy the etf and bitcoin doesn't go up
They short the etf and bitcoin goes down
Explain this

Both long ETF shares and short ETF shares, involve ETF shares which are just promises to deliver Bitcoin to the few people who do try to convert their ETF shares into Bitcoin

Only when someone tries to convert ETF shares to Bitcoin is Bitcoin purchased by the ETF

So both long ETF shares and short ETF shares bring the price of Bitcoin down because the promise to Bitcoin creates a supply of Bitcoin which is more than 21 million BTC

Let's say BTC EFT was standardized and the dust settled for a bit, and then there was a bankrun on BTC withdrawals after the liabilities ballooned into the derivatives sphere...what err...what happens next?

>>57280306
no, the sec clearly state etfs have to settle day to day.

>>57280346
>Hedge funds doing the right thing

>>57280306

You are wrong.

For reference here is the full S-1 detail of Spot Bitcoin ETF logistics and functioning.

There is very little detail on how the market price of Bitcoin will be effected. It appears the issuer will obtain the Bitcoin from the Custodian, who may already have the Bitcoin thus not executing any market orders.

>>57280346

For reference here is the full S-1 detail of Spot Bitcoin ETF logistics and functioning.

There is very little detail on how the market price of Bitcoin will be effected. It appears the issuer will obtain the Bitcoin from the Custodian, who may already have the Bitcoin thus not executing any market orders.

>>57280330

All liabilities are cash settled everywhere. That is how fiat money is legally defined, i.e. as an instrument to settle all debts public and private.

So any debts arising out of a bankrun on the ETFs will be settled using newly minted dollars from Federal Reserves bailouts.

>>57280346

See >>57280424

You are wrong.

>>57280276

Explained here : >>57280306

so this is how they kill bitcoin. cobie was right

>>57280306
Wouldn't that just create a gap in the etf and spot price? Is arbitrage between those two possible?

>>57280493

Only authorized participants can help you redeem the Bitcoin underlying a Bitcoin ETF.

iirc BlackRock Bitcoin ETF uses JP Morgan as the authorized participant.

So you will have to start a relationship with JP Morgan to this arbitrage. My guess is that only a few rich people will be permitted to have this relationship with JP Morgan

As long as only a few people can redeem the actual Bitcoins, the ETF can operate with just Bitcoin liabilities and never having any Bitcoin on the blockchain.

i cant wait til you btc faggots sound like the gme faggots screaming about the hedgies and the corruption on wall street

KEKKKKK

>>57280531
Still don't get it. The ETF price would go down, because BlackRock wont own the underlying BTC thus inflating the actual supply. But why would the spot BTC price follow the ETF price? In order to do a successful arbitrage you'd have to buy cheap ETF BTC and then sell it for real BTC?

>>57280567

> why would the spot BTC price follow the ETF price?

Because BlackRock is promising on-demand convertibility from ETF to Bitcoin for authorized participants. Actual conversions for the ETF shares to the underlying Bitcoin is rare.

> In order to do a successful arbitrage you'd have to buy cheap ETF BTC and then sell it for real BTC?

To access the underlying in any ETF, you need to form a relationship with the authorized participant.

Relevant Tweet: https://x.com/CryptoKingKeyur/status/1739276082195628240?s=20