Disadvantages of Bitcoin ETFs!
Bitcoin ETF was a possibility yesterday on the 10th. Even early yesterday morning, a tweet about this was shared from the US Securities and Exchange Commission's Twitter account. However, the account was then hacked and the tweet claimed the ETF was approved. Anyway it is very likely to be approved this month. Currently it has become a hot topics. Yesterday I discussed the advantages of Bitcoin ETFs today I will discuss some of its disadvantages. So let's start the discussion:
.jpg)
ETFs typically offer some of the benefits I discussed yesterday. And for providing all these facilities they charge management fee. And the amount of this fee may increase over time. Which can be one of the disadvantages for investors as they have to pay high fees.
ETFs generally track the value of the underlying asset. Many also try to diversify their portfolios by holding multiple holdings. A very important point here is that a 50% increase in the price of Bitcoin may not be accurately reflected in the price of the Bitcoin ETF due to its other holdings. That is, it may or may not be accurately reflected in its price. An ETF typically provides leverage over the price of Bitcoin at times. But then it cannot be said for sure whether it will be an accurate tracker of its value because it may or may not be an accurate tracker of value.
As we know Bitcoin is not limited to certain transactions rather it can be traded for other cryptos. Like Ethereum, Litecoin, XRP, and more. But Bitcoin ETFs have some limitations. Because it is not a cryptocurrency but simply an investment fund that tracks the value of Bitcoin. As a result it will no longer be tradable for cryptos in that case.
We know cryptos are still unregulated. Because they still act as a hedge against any central bank, fiat currencies and equities. So the government wants to regulate crypto through it. We all know nowadays that these digital currencies are not controlled by any central bank. Moreover, they maintain confidentiality through transactions. Moreover, all the information about who is doing the transaction is completely confidential. Moreover, they provide a way to reduce the risk currently associated with the Bitcoin financial system. But if Bitcoin ETF is approved then it will be regulated by the government. And then we will be deprived of all these benefits
Good explained. Thanks for sharing this informative post.
Thanks
Thank you, friend!
I'm @steem.history, who is steem witness.
Thank you for witnessvoting for me.
please click it!
(Go to https://steemit.com/~witnesses and type fbslo at the bottom of the page)
The weight is reduced because of the lack of Voting Power. If you vote for me as a witness, you can get my little vote.
tweet link
You have share a good content
Thank you
Really very nicely explained about Disadvantages of Bitcoin ETFs! Wish you all the best. Keep posting like this.
Thanks for your nice feedback
Upvoted! Thank you for supporting witness @jswit.
Every subject has good for bad site. Etf approval is good news for us. But in future it could be bad for us.
Right. Every subject has good for bad site.
Thanks
Blackrock will control the price after this ETF approval so we will not have more volatility in bitcoin and I think this is the biggest disadvantage.
Thanks for your valuable feedback
Thanks for noting down the disadvantages of bitcoin ETF for us, nice and timely article you have shared.
Thanks for your nice feedback