Following the U.S. Securities and Exchange Commission approval and subsequent trading of bitcoin-linked exchange-traded funds, we've seen a huge surge in activity surrounding the most popular blockchain currency. But it's a complex story, and constantly changing. Here's what the Twitterati and other pundits are saying about the digital token:
Week 1: Bitcoin becomes the second-biggest commodity ETF asset class
One week after bitcoin ETFs went on the market, they've risen to amass a combined value of $27.9 billion, according to Capital 15C. As James Van Straten writes for Cryptoslate: "To put these figures in context, the ‘Broad Diversified’ asset class, previously the second-leading commodity in terms of assets under management (AUM), secures $12,826 billion across 22 ETFs."
That's a lot of enthusiasm for a brand-new slate of ETFs.
Bitcoin itself is plunging
Meanwhile, Bitcoin itself fell to its lowest point in a month. This places it about 10% lower than its price level before the ETFs started to trade. Many are arguing that "sell the news" behavior is dominating the day. But there's at least one other story playing out behind the scenes, like this one described by Bryce Elder in Financial Times:
"A neater explanation involves Grayscale Bitcoin Trust, a publicly listed bitcoin warehouse that led the lobbying for US spot ETFs to be legalised. GBTC had since 2017 been operating a bitcoin lobster pot: anyone with bitcoins could give them to Grayscale Investments in exchange for OTC-traded shares in the trust, but there was no way to get the bitcoins back.
GBTC last week converted to an ETF, giving its backers their first opportunity to reclaim the $28bn or thereabouts of bitcoin it had collected. And in the four days following spot ETF approval GBTC redemptions have totalled more than $1.6bn."
JPMorgan Chase CEO Jamie Dimon is tired of all the bitcoin talk
"I call it the pet rock," JPMorgan Chase CEO said to CNBC on Wednesday. "My personal advice is don't get involved," calling it a "hyped-up fraud."
He was asked: "What do make of the other firms—the Blackrocks of the world, … [like] Larry Fink who changed his view of this?"
"Number one: I don't care, so please stop talking about this shit," replied Dimon.
Coinbase says buying crypto is like collecting Beanie Babies
As covered in Bloomberg, William Savitt, a lawyer for Coinbase Global Inc., told U.S. District Judge Katherine Polk Failaa that trading digital tokens on an exchange is fundamentally different than trading securities, and shouldn't be subject to SEC jurisdiction.
“It’s the difference between buying Beanie Babies Inc. and buying Beanie Babies,” he said, adding:
“When you are buying a collectible, let’s say a baseball card or a figurine of some kind, you’re just buying the item,” SEC lawyer Patrick Costello said. “You are buying a thing. You are not buying into something. And that, I think, is the difference. There is no enterprise that is involved in this.”
