Arthur Hayes on the Spot Bitcoin ETF
Bitcoin co-founder Arthur Hayes wrote a blog post about the potential introduction of a spot Bitcoin ETF in the United States and its implications for Bitcoin. According to Hayes, a spot Bitcoin ETF might be more appealing to the U.S. political establishment if traditional finance entities submitted their applications. He humorously suggested that conforming more to the traditional Wall Street image might have improved the luck of early Bitcoin ETF proponents like the Winklevoss twins.
The Fundamental Nature of Bitcoin
Hayes’ analysis underscores the fundamental differences between Bitcoin and traditional monetary assets. He believes that due to its contingent existence, being primarily dependent on its movement within the network, unlike gold or fiat currency, Bitcoin faces unique risks. Specifically, he points out that Bitcoin’s survival is closely tied to its active use, especially after 2140 when Bitcoin block rewards hit zero, making miners rely solely on transaction fees for income.
Concerns about TradFi Asset Managers
Hayes expressed concern about the potential impact of large TradFi asset managers like Blackrock entering the Bitcoin space, suggesting that their accumulation of assets, storing them, and using ETF derivatives instead of buying and holding Bitcoin could lead to the network’s demise. He sees a poetic aspect to this potential outcome, suggesting it could create space for another crypto monetary network to emerge, possibly a reboot or an improved adaptation of Bitcoin.
The Importance of Choice and Fiat Debasement
Hayes highlighted the importance of choice in the context of ongoing fiat debasement. He advised buying Bitcoin and using self-custodial wallets rather than relying on centralized exchanges and ETFs for the preservation of wealth in energy terms using a financial system outside of state control in the face of trading financial assets to earn more fiat.
Hot Take
The idea of a spot Bitcoin ETF might change the nature of Bitcoin and its potential demise due to inactivity, but it also highlights the importance of choice for individuals seeking an alternative form of wealth preservation in the face of ongoing fiat debasement. Hayes’ insights raise essential questions about the future of crypto, Bitcoin’s existential risks, and the emergence of alternative crypto monetary networks in the future.
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