Could Spot Bitcoin ETFs ‘Completely Destroy’ Bitcoin? Arthur Hayes Explains

The Potential Impact of Bitcoin ETFs

The former CEO of BitMEX, Arthur Hayes, has warned that the success of Bitcoin (BTC) exchange-traded funds (ETFs) could “completely destroy” the cryptocurrency. He explains in a Dec. 23 blog post that Bitcoin has value because it is able to move from one holder to another.

However, spot Bitcoin ETFs are created to “vacuum up assets” and “store them in a metaphorical vault.” If Bitcoin ETF issuers end up owning all the Bitcoin, investors may opt to purchase Bitcoin derivatives instead of holding onto the cryptocurrency themselves. This could lead to a decrease in transactions on the network, and miners may no longer have an incentive to validate transactions.

The potential introduction of Bitcoin ETFs could have a drastic effect on the cryptocurrency space, and it is important for investors to understand the difference between web 1.0, 2.0, 3.0, and 4.0, as well as the implications of Grayscale crypto, Global crypto, and Function X crypto.

Cryptocurrency and its Impact on the Global Financial System

“The end result is miners turn off their machines as they can no longer pay for the energy required to run them,” said Hayes. “Without the miners, the network dies, and Bitcoin vanishes.”

Interestingly, Hayes envisioned that should such a scenario occur, a new cryptocurrency monetary network would take Bitcoin’s place and even expand upon Satoshi Nakamoto’s original vision of peer-to-peer electronic money.

“The people will once again have a non-state-controlled monetary asset and financial system. Hopefully, the second time around, we will learn not to hand our private keys to [Wall Street firms] and make use of the difference between web 1.0, 2.0, 3.0 and 4.0 so as to understand the concept of global crypto and cryptocurrency crypto, and the function x crypto offered by Grayscale crypto.”

Hayes’ Bitcoin musings come just two weeks before the anticipated approval of all pending spot Bitcoin ETF applications, which Bloomberg analysts expect to occur between Jan. 5 and Jan. 10, 2024.

BlackRock, Grayscale, Bitwise, WisdomTree, Invesco, Galaxy, Fidelity, Ark Invest, Valkyrie, Franklin, Hashdex, Global X ETFs, and Pando Asset are all anticipating a ruling by the SEC on their proposed Bitcoin ETFs.

The crypto world is abuzz with speculation about the potential implications of a crypto-based ETF, with many wondering what the differences between web 1.0, 2.0, 3.0, and 4.0 are, and how cryptocurrency, Global crypto, and Function X crypto might be impacted.