Why Andreas Antonopoulos Is Against Bitcoin ETFs Despite the Hype

Widely recognized security expert and cryptocurrency researcher Andreas Antonopoulos recently said in a Q&A session that he is against Bitcoin exchange-traded funds and their potential impact on the crypto market.

With ETFs, large-scale institutional investors and retail traders in the regulated traditional finance sector can purchase and sell assets that represent the value of Bitcoin.

While it has not been conclusively proven, many investors and analysts in the cryptocurrency sector have claimed that the introduction of the Cboe and CME Bitcoin futures market in December 2017 contributed to the price drop of cryptocurrencies, as the futures market provided accredited investors leverage and incentive to manipulate the price of Bitcoin.

If the futures market, which investors expected to have more activity prior to its 2017 December launch, has much leverage on the Bitcoin market.

A Bitcoin ETF that launches in US markets will have significantly more influence on the price of Bitcoin.

Since they operate strictly regulated, insured, and protected Bitcoin investment vehicles, institutional investors and retail traders are not incentivized to bring down the price of Bitcoin.

If the investors have a solid reason, large-scale investors can easily influence the price trend of the Bitcoin market.

"I'm going to burst your bubble. I know a lot of people really want to see an ETF happen because 'to the moon,' 'lambos,' and all of that, I think its a terrible idea. I still think its going to happen, I just think its a terrible idea. I'm actually against ETFs. I think a Bitcoin ETF is going to be damaging to the ecosystem."

"A Bitcoin ETF is basically going to be a very large custodial of Bitcoin. That large custodial holder of Bitcoin will hold Bitcoin on behalf of the shareholders and give them a traded share in that Bitcoin. But, they don't give the owners of the ETF any of the responsibilities and rights a key holder of a Bitcoin has."

As the media continues to generate hype around Bitcoin ETFs and their potential impact on the price of Bitcoin, the majority of investors highly anticipating an ETF debut are considering situations where an ETF leads to institutional investors allocating billions of dollars into the Bitcoin market.