I thought this post would be relevant for today, because according to the coindesk article here (http://www.coindesk.com/winklevoss-bitcoin-trust-departs-nasdaq/) , the SEC has only 45 days to either respond or extend the date for a longer comment period on the Winklevoss Bitcoin ETF and today is the 43rd day. Most likely we will be hearing from the SEC in the next week or so about their decision, which in my opinion will be to extend the comment period, but enough of a background, let’s talk about why a bitcoin ETF would change everything for all cryptocurrencies.

Helping Mainstream Adoption Through Ease Of Use

I have always said for the last 3 years that the biggest “killer apps” for bitcoin is store of value and speculation, a belief that I still stick to. In my opinion both of these apps are being hindered by the bitcoin not being user friendly. If you believe that bitcoin is user friendly I would strongly disagree with you. Until my 90 year old technologically impaired grandmother can use bitcoin I don’t think it is user friendly. The fact remains that every day coins are stolen from wallets around the globe and there is zero recourse if this happens. These things can be avoided with strong passwords and security, but if the most recent twitter hack where around 125,000 people used the password 123456, teaches us anything it is that mainstream users don’t take security seriously. An ETF allows people to take part in the two largest killer apps, speculation and storing a value without having to worry about any security at all. Many people want to do things by the book and are ok with having someone hold their keys and I think this is fine is some situations. Not only do they not have to worry about security, but they don’t have to worry about going to a sketchy exchange to get their coins, when they can just purchase them via a stockbroker. If you look at the GBTC fund which is currently trading at an 80% premium on the price, largely because of the aforementioned arguments, you can see what people are willing to pay for ease of use. For a layman the best way to get their feet wet with cryptocurrencies in general would be through the ETF.

Adding Legitimacy To All Cryptocurrencies Through Reputation

Despite what we here might think about Wall Street and organizations like NYSE, the great majority of people believe in the reputation they carry. People honestly believe that if a company is listed there then it can’t be a total scam. Whether or not this is true, being listed on a main exchange would silence many naysayers who are calling crypto in general a ponzi scheme or worthless in value. Having a bitcoin ETF would not only add legitimacy to bitcoin, but it would add legitimacy to other cryptocurrencies as well. People will slowly be “Trojan Horsed” into the idea of blockchain based solutions because they can see the value of bitcoin. Much like the precious metals market we have now, we could have a vast cryptocurrency trading market on Wall Street within 10 years.

Adding Much Needed Liquidity For Big Players In the Market

There are many big players who currently don’t want to take the risk purchasing on exchanges and storing the coins by themselves, as well as exchanges not having enough liquidity to purchase or sell in large amounts. Before the Gold ETF was launched, big players had the same problem and as soon as it was, the price of gold skyrocketed because the market became much more liquid and easier to trade with. Large exchanges with access to institutional investors would increase the much needed liquidity to the bitcoin or crypto space in general. With Wall Street, comes hundreds of billions in untouched resources that could enter the market and a more robust bid and ask spread to accompany it.

An ETF Could Frame Future Regulation

If an ETF were to launch, the potential for it to frame the debate for regulation would be huge. Right now politicians see it as something used by scum in the underbelly of the internet, but the reputation that would come with the SEC approval could change that. There could be a movement for massive deregulation like there was for the internet so this technology and startups around it could prosper. In addition other foreign governments who usually follow the US on these types of regulations will start to endorse cryptocurrency which makes everyone better off in the long run.

My goal for bitcoin and other cryptocurrencies was always to get the technology into as many hands as possible, so they could see the real benefit for themselves. I truly believe an ETF will help accomplish these goals and more. I think we can accomplish them even without an ETF, but with one we can accomplish them much faster and more effectively. If you have any comments or anything else you wanted to add, feel free to reply and I will respond!

-Calaber24p