Bitcoin Comes To the Big Board (nytimes.com) 91
Bitcoin has been on a tear in recent weeks, approaching record high prices above $60,000, as crypto enthusiasts anticipate history in the making. Tomorrow morning, ProShares will launch a long-awaiting exchange-traded fund on the New York Stock Exchange linked to Bitcoin futures, the firm and the exchange told DealBook. From a report: The E.T.F. will give investors exposure to Bitcoin without having to hold the cryptocurrency directly, via any ordinary brokerage account. "2021 will be remembered for this milestone," said Michael Sapir, the C.E.O. of ProShares. Investors who are curious about crypto but hesitant to engage with unregulated crypto exchanges want "convenient access to Bitcoin in a wrapper that has market integrity," he said. For nearly a decade, crypto entrepreneurs and traditional finance firms have sought permission to launch a Bitcoin E.T.F. in the U.S., but their applications have been delayed or denied by the S.E.C. Many remain pending.
A Bitcoin futures E.T.F. falls short of what some purists want: a fund that holds crypto directly. Gary Gensler, the S.E.C. chair, recently suggested that the agency might allow crypto E.T.F.s based on futures -- bets on Bitcoin's price fluctuations rather than the underlying crypto itself -- that trade on a highly regulated exchange. Approval for the ProShares E.T.F., which is based on Bitcoin futures that trade on the Chicago Mercantile Exchange, won't be announced by the S.E.C., but the firm's final prospectus met with no opposition ahead of its effective deadline, and the N.Y.S.E. is readying for launch tomorrow.
A Bitcoin futures E.T.F. falls short of what some purists want: a fund that holds crypto directly. Gary Gensler, the S.E.C. chair, recently suggested that the agency might allow crypto E.T.F.s based on futures -- bets on Bitcoin's price fluctuations rather than the underlying crypto itself -- that trade on a highly regulated exchange. Approval for the ProShares E.T.F., which is based on Bitcoin futures that trade on the Chicago Mercantile Exchange, won't be announced by the S.E.C., but the firm's final prospectus met with no opposition ahead of its effective deadline, and the N.Y.S.E. is readying for launch tomorrow.
Crypto Futures? (Score:5, Insightful)
This really is one of those "What could possibly go wrong?" moments.
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Re:Crypto Futures? (Score:4, Insightful)
And look how well that turned out.
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(insert meme: He's out of line, but he's right)
Re:Crypto Futures? (Score:4, Insightful)
Except Bitcoin is more like the whaling industry. It's terrible for the environment, and destined to be rendered obsolete when something better comes along.
Re:Crypto Futures? (Score:4, Insightful)
One of them performs a vital function in our lives and economy in a vastly more efficient way than previous methods, the other gives us a payment system used mainly by nutjobs and criminals that is vastly less efficient than any other method used or imagined.
I'd also like to see a citation because I'd suspect that cryptomining is using a far greater amount of electricity than the world's EVs.
Re:Crypto Futures? (Score:4, Insightful)
I hear Bernie Madoff and Elizabeth Holmes were driving pretty nice cars.
If your metric for whether something is right is "how much money some people made".
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They were practically early beneficiaries of a pyramid scheme, these days gambling on Bitcoin values is...just another form of gambling. The odds aren't that bad, but there isn't as much to gain as getting in on the ground floor.
Wealth is almost an indicator of malevolence in our society anyway. Once you get into the 6 digits per year you soon run out of ways to make money that aren't plainly destructive.
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You can literally produce your own Bitcoin for pennies on the dollar.
Bitcoin is replacing the fiat economy with the equivalent of a gold standard, that's scaring a lot of people, because it means theft by governments (hidden taxes and inflation) is harder to implement.
I though people around here were a lot more opposed to the big business and banking industry controlling their lives. How things have changed, now everyone wants the big government to interfere in everybody's lives and extract as much value fo
Its not a "pyramid scheme", its "greater fool" (Score:3)
"In finance and economics, the greater fool theory states that the price of an asset is determined by whether you can sell it for a higher price, at a later point in time. On assets where the theory applies, it is implied that the asset's intrinsic value is less important than the increase in demand, however irrational it might be. Any person buying the asset might be a fool, but a person buying the overpriced asset later on,
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and the greatest fool of all is the last person to accept the new reality.
Re: Its not a "pyramid scheme", its "greater fool" (Score:2)
How is this not true of everything? I can't tell if you support the person you are replying to or not but you do seem to be captain obvious.
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and the greatest fool of all is the last person to accept the new reality.
The reality is that Bitcoin is temporary, short lived, its an experiment. It will be replaced by a better design, better implemented and more capable cryptocurrency. The real technology here is blockchain. Bitcoin is just the first user of blockchain that received widespread attention from the masses. Bitcoin is like the Ford Model T car, the first widely popular car, based on internal combustion engine technology. And like the Model T it is entirely replaceable. Its actually more easily replaced as the swi
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Not investing in Bitcoin isn't the worst thing you could've done. Plenty of people have bought and sold at the wrong times and lost their shirts over it. Where do you think that "profit" comes from? It's the result of wealth redistribution from losers to winners, and the losers are often just regular folks hoping to turn a little bit of their savings into something bigger. The ultra rich can afford to manipulate the market to their benefit (see Elon Musk's tweets, for example).
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Not sure about nutjobs, but I do wish I did hop on the ka-ching train, even when we were making fun of it a few years back when it was at $1000 or so... all the "Bitcoin Bros" are driving better cars than most people now, so they are doing something right.
Much like the early tulip traders who got to afford the really good horses. :-)
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"One hundred idiots make idiotic plans and carry them out. All but one justly fail. The hundredth idiot, whose plan succeeded through pure luck, is immediately convinced he's a genius."
That's a little harsh, but crypto is a high-risk investment, and wh
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When somebody makes what you would probably consider to be safe, sober and reasonable choices pursuing a goal, when they succeed many (most?) people point and say "See! Here is a person that succeeded because of their wise choices." When they fail, more often than not the story goes that they were doing everything right, but suffered some bad luck and that's what did them in.
Now consider someone taking
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Social media second, cryptocurrency is less socially destructive but vastly more resource-intensive. Plus social media never made the price of any computer components like video cards or hard drives fly up.
Crypto does not require wasting electricity (Score:2)
Etherium is switching from proof-of-work to proof-of-stake in a few months (if the schedule holds). Etherium always wanted to be proof-of-stake but there is an early distribution problem. Going proof-of-work temporarily solved that problem.
Video card GPUs are not used for mining bitcoin, that ability ended long ag
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One of them performs a vital function in our lives and economy in a vastly more efficient way than previous methods, the other gives us a payment system used mainly by nutjobs and criminals that is vastly less efficient than any other method used or imagined.
Fortunately, no one person gets to decide what is or is not a vital function in "our society," at least not yet. So for the time being, cryptocurrency is at least safe from this brand of reasoning.
I don't think that I would argue that Bitcoin's major strength is efficiency. I won't lie and claim I haven't seen people argue the point, but I haven't been convinced by them and won't suggest this myself. I will say that there is more to value than just efficiency, and people often overlook inefficiencies in
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The value of a product is generally determined by its scarcity and its utility.
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It is a fair argument though for using alternative cryptos in leiu of Bitcoin. Bitcoin is one of the worst in terms of watts-per-transaction, with many alternatives like Doge being thousands of times more efficient.
https://www.trgdatacenters.com... [trgdatacenters.com]
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My question in terms of deciding on whether to take part in the ETF: does the volume or scale of trades on the ETF indirectly contribute to increasing bitcoin fees (aka increasing demand for transactions on the blockchain), and thus, increased mining due to the higher fees?
I assume that the answer is yes, and thus my answer for whether to take part is "no".
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I think it's also important to know that the rolling of futures eats into the value of the etf, calculated in this case to be about 10-20%/year.
Blockchain is long term, bitcoin is temporary (Score:2)
Except Bitcoin is more like the whaling industry. It's terrible for the environment, and destined to be rendered obsolete when something better comes along.
I prefer a car analogy. :-)
Blockchain is like the internal combustion engined (ICE). Bitcoin is like the Ford Model T car. Just the fist widely popular user of the new technology, the thing that brought the new technology to the masses, yet utterly replaceable itself. Blockchain will be with us for a while, but bitcoin is just a user that that will be replaced by some newer and better design.
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There difference between oil futures and bitcoin futures is?
Difference (Score:5, Informative)
Oil futures are used by companies dependent on oil to hedge against price spikes. If you are a plastics or fertilizer company a few dollars difference in oil price can cost you millions of dollars. So, you hedge against price fluctuations so you can fulfill long term orders at a set price without loosing money on the order.
Of course, people also "bet" on oil futures, but that's not why they exist.
Re:Difference (Score:4, Interesting)
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Futures do not need to be tied to commodities (or 'things'). There are markets for common indices like the S&P 500, the Dow and the Nasdaq 100.
There are markets for currencies and markets for interest rates.
Futures have a transparent and regulated process backed by contracts, settlements, and margins.
The method ProShares is using is the safest method of exposing Bitcoin to the plebes. That's why they can charge 95 basis points as a management fee for the trouble.
But if you learn how futures markets work
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futures are a time honored tradition: I'll gladly pay you Tuesday for a hamburger today.
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All anyone needs see are all the crypto proponents who claimed bitcoin was the alternative to all the shady shit banks do rejoicing when they start doing all the same shady shit banks do.
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Futures trading isn't shady. What is shady is the government interfering in futures contracts whenever it doesn't go their way (inflation, printing cash based on "government futures" and messing with interest rates).
The market should be a lot more volatile to be accurate. But the losses gets absorbed by the tax payer while the gains get absorbed by the corporations. With Bitcoin there is no 'printing press' to pump and dump faulty valuations in futures. If you agree on a 30y smart contract for an overvalued
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Looks like the next stock market crash will be cause by concentrated weapons-grade stupidity that is 100% predictable even to the layman. Good thing virtually all of the stocks are owned by the rich, if not for the job losses we could just break out the popcorn and enjoy this train wreck.
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GO GO GO!
The higher it goes, the more spectacular the crash would be. With the previous lessons of CDS, anyone still naive enough to think that Wall Street would pass up a chance on *anything* they can create a market out of and get fools putting in money?
We may live to see another huge crash that can rival the Lehman Brothers!
Investing in speculation (Score:1)
It's like the Inception of investing. Can we go deeper?
"Big bucks! Big bucks! No Whammies!" (Score:2)
"Big bucks! Big bucks! No Whammies!"
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STOP!
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WHAM!
Re:You Assholes (Score:4, Insightful)
The smart people left long ago and now all that’s left are old people stuck in their ways. They don’t understand social media or crypto and their opinion is to ban things simply because they don’t like it.
The old paranoid crowd that doesn’t like government meddling should love crypto by all rights. It checks every box on their agenda.
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Especially if you realize that Bitcoin was pretty much launched on this platform.
Perhaps that's it. The smart people picked up on it and are now living on their yachts and only check /. occasionally for old time's sake.
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Yup, I just come here to laugh at the neo-luddites.
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If you've been paying attention then you should have shorted TSLA too.
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When you're in a bubble it looks like a massive missed opportunity. And then it pops. You could have made money out of tulips if you timed your exit right, but you probably would have got it wrong just like so many others. When would you have exited the housing market before 2008? How many dotcoms would you have invested in and dumped before everyone else realised they were mince? Will you remember your post today when someone discovers a fundamental flaw in Bitcoin and they discover that the blockchain is
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It won't be a newly discovered flaw. It might be that the bitcoin network just gets popular enough to get crushed under the load. Or one of the hidden bitcoin whales might decide to cash out. Or the US government might realize, like China, that everyone using a currency you do not control makes you a de facto third world economy.
Or bitcoin might transition to some sort of stable form. It's a bit hard to see what that will be though. Competitive transaction fees aren't going to support anything like the curr
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Except there is some actual value to bitcoin, in a way. It's value is based upon the demand coming from illegal activities; drug monies, money laundering, ransomware and other scams, etc. The price would not have gone up like it had if it were just a few armchair economists stuck in their ideas that "giat" currencies are all phony and printed at a massive rate and we'll all die soon bcause of it unless we go to bitcoin (and only bitcoin, not those other better designed currencies).
Tulips had some utility too ... (Score:2)
Except there is some actual value to bitcoin, in a way. It's value is based upon the demand coming from illegal activities; drug monies, money laundering, ransomware and other scams, etc.
No its not. Bitcoin may have some utility for "money transfers" but its value is really based on financial speculation. Bitcoin is overwhelmingly a speculative investment vehicle. Tulips had some utility too, they smelled nice, they were pretty, they could make people smile. However they too became a speculative investment vehicle and caused great pains for fools.
The underlying theory for Tulip and Bitcoin investment:
"In finance and economics, the greater fool theory states that the price of an asset is
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A lot of us looked at the Value and the values (Score:2)
A lot of us looked at the value and the values of crypto, and judged as something we didn't like and/or wanted to fail. We projected. The market, as it stands, cares nothing for value in the financial sense; and hates certain values in the social sense.
Guilty as charged. I missed this big time. When it was first announced on /., I didn't even comment about the coin--I commented on the idea of gold and the folly of that, along the lines of it just being digital gold.
At that point, it's quite plausible to
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A lot of us looked at the value and the values of crypto, and judged as something we didn't like and/or wanted to fail. We projected. The market, as it stands, cares nothing for value in the financial sense; and hates certain values in the social sense.
Well, to be fair, the market doesn't hate anything. It may be that certain participants in the market don't share your values, and that is probably true. This is not a nitpick. Some of the attacks leveled at Bitcoin and cryptocurrency would be better directed at specific people, rather than the technology platform or community at large. I've kn
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Such a long, cordial and well thought-out response I feel like I'd be a cad if I didn't at least say something; despite not really being in the mood.
I want to leave this post as a "marker" really because I know I'll come back to it at some point. Also, will mark as "friend" here FWIW.
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For every 'blockchain' 'crypto' coin that you hear about that's only 'making money', there are many more that utterly and completely failed causing millions in losses.
And the main reason why you don't hear a lot about those? Because the people getting in on the ground level of those are generally also the people raking in the money on others, and they don't want others to lose trust in the crypto that *is* doing well, because the more people buy into their crypto, the more money they make.
(This is my opinio
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For every 'blockchain' 'crypto' coin that you hear about that's only 'making money', there are many more that utterly and completely failed causing millions in losses. And the main reason why you don't hear a lot about those?
Maybe it is because I follow the topic, but I've heard plenty of those stories. The biggest failures have been splashed across the headlines of mainstream outlets for all to see. Are you suggesting that there are people that know about cryptocurrency beyond Bitcoin, but that aren't aware that coins fail? I've honestly never encountered that. I mean, they cover relatively minor dips in Bitcoin in the regular news now.
Without fiat to give it value.... (Score:1)
Did you ever notice how the bitcoin bros are always boasting about the price of it while trashing fiat currencies? And how they always use a fiat value to compare its price with?
Without fiat to give it value, their precious bitcoin is worthless.
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In five years it will flip. You will read about the price of dollars, in bitcoin, and how dollars are so volatile. House and other prices will be stable in bitcoin, and all over the place in dollars. Holding fiat will be an exercise in frustration.
Because derivatives worked out SO well... (Score:2)
....let's just built more economic mountains on even-LESS-justifiable financial grounds, like speculating on the climb/fall of completely arbitrary consensus goods that have no real existence.
I feel there is a clear metaphor here for the vast edifice of our Western Financial Structures.
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On top let's add:
"...Biden recently tapped Saule Omarova â" a law professor at Cornell University and a 1989 graduate of Moscow State University â" to serve as Comptroller of the Currency, which âoecharters, regulates, and supervises all national banks.â
She has so far refused to turn over her thesis paper "âoeKarl Marxâ(TM)s Economic Analysis and the Theory of Revolution in The Capital.â to the Senate. This was completed at Moscow State University, where Omarova was on th
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If you know how to use these things, the risk is understandable and potentially manageable. They will not work for long term bets for or against bitcoin due to the cost of laddering futures. They can help manage risk in accepting bitcoin for transactions though.
The only thing that would really scare me about them is what happens if Bitcoin ever switches to proof-of-stake. You would really need to design the futures in a way that they are resilient to this event, but I have a gut feeling they cold have op
It's derivatives all the way down (Score:1)
Because derivatives worked out SO well...
You are even more right than maybe you knew, as the current price of BTC is propped up by people buying BTC on margin [cnbc.com], so it's derivatives all the way down!
I have just a little crypto now and then, but FOBA (Fear of Being Annihilated) makes me sell it any time I hit substantial gains, like now, for fear they will all vanish.
I think there is huge value in BTC/ETH and it will be vastly important going forward as people seek to flee debt-backed government currencies. B
Well good for them! (Score:1)
Now they can be taxpayer funded with that 120 billion a month bailout money, as if they weren't already
Comparison (Score:2)
There's a sucker born every minute. (Score:2)
--P. T. Barnum
You can't let them in here! (Score:1)
"a fund that holds crypto directly" - buy GBTC (Score:2)
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