The Bitcoin ETF Is Bad For Bitcoin.

The Bitcoin ETFs are in full force after ten long years and an immense amount of FUD. Today, they market their first full day of trading on the stock market. What were the results of this groundbreaking day? Massive God candle? New all-time highs?

Nope. Nada. Zilch. Nada. The price of Bitcoin went down! As of this writing, the price of Bitcoin stands at a whopping $46,852. Needless to say, that day one was a letdown. It was not what I expected, and many on Bitcoin Twitter were also scratching their heads.

Considering that these ETFs reached $3 billion in trading volume on day one shows an appetite for this type of product. The big question is when do they make their purchase of spot Bitcoin, as this will have an impact on market dynamics from now on.

The mechanics of how a Bitcoin ETF purchases Bitcoin differs from how you or I purchase Bitcoin on the open market. In a nutshell, they are not buying Bitcoin on Cashapp or Strike. Check out this article for a detailed account of how it works in practice.

These ETFs are buying Bitcoin p2p from large institutional market makers and are not impacting the price yet. This is poised to change once they run out of Bitcoin that they can purchase from each other. Watch out once this reshuffling is over; my friends, things could get interesting.

We can see Bitcoin reach new heights by the end of the year with these new large buyers in the market.

Are ETF’s Good For Bitcoin?

My question to you is, is this good for Bitcoin? Honestly, I don’t know. Does the average investor who will be using these investment vehicles understand Bitcoin? Absolutely not. They surely don’t care about the monetary revolution that Bitcoin represents. They will only care about their portfolio going up in value. Do we want people in the movement who don’t understand a lick about Bitcoin determining its future? I would hope not.

Bitcoin, to them, is nothing more than another asset to be bought and sold. It feels like the people who were advocating for a Bitcoin ETF sold the soul of Bitcoin to the devil. I’m generally in the camp that everything is good Bitcoin, but there is a caveat.

Development and different use cases, such as Ordinals, happening on on-chain Bitcoin, are good for Bitcoin. Anything that can lead to state capture of Bitcoin is NOT good for Bitcoin, even though it could be good for Bitcoin’s price action in the short to medium term.

A Bitcoin ETF is the opposite of what Bitcoin was created for. The fact that we don’t need permission to use and spend Bitcoin is what makes it a zero-to-one invention that should be treasured.

Bitcoin purchased by an ETF is not Bitcoin. You don’t actually own it because it’s not in your custody. You can’t even use it to buy goods or services. I believe a Bitcoin ETF is worthless and should be avoided by Bitcoin maximalists.

Bitcoin ETF Prices Out The People Bitcoin Was Supposed To Help

What happens when the supply crunch hits and the price begins to skyrocket? What does that do for the average Bitcoiner trying to stack sats and build generational wealth? The Bitcoin ETFs will severely hamper this mission because how can you compete with these large entities buying up all the Bitcoin? They will move it to cold storage and never be moved again. Big money isn’t dumb, and they know what they are doing. They will pump the price up so high that they can get ahold of your precious UTXOs and leave you with depreciating paper fiat currency.

I hope you like buying one sat at a time because that’s what will happen soon when they real start entering the spot market for Bitcoin. Resist the temptation to cash out!

The Bitcoin Monetary Revolution Will Die

In addition to driving up the price of Bitcoin, these ETFs will serve as the Trojan horse to introduce draconian laws to restrict or outlaw self-custody. How easy would it be for the government to create a white market for Bitcoin and a black market for Bitcoin?

Suppose these large entities hold the majority of Bitcoin. In that case, it will be easy for them to call up their congressman and lobby them to make self-custody a crime because it is used to finance terrorism and other nefarious activity. The EFT’s custodians would put themselves on a pedestal and claim that their Bitcoin is all KYC’d, tracked, and compliant with the law, while “Black market” Bitcoin is not.

Imagine this kind of law is passed: Bitcoiners who are self-custody will have to face a dire choice: do they give up their Bitcoin or leave the country? I think many Americans will probably sell their Bitcoin versus leaving the country, contrary to the rhetoric you may hear otherwise. It’s hard to leave your family behind, especially over an asset that 99 percent of your friends and family don’t understand.

Once self-custody Bitcoin is captured, what will be left of Bitcoin? Nothing. At this point, the monetary revolution that is Bitcoin will be dead.

I hope I am wrong, but introducing these massive players into the market is a hurdle for the Bitcoin revolution. The best thing we can do as Bitcoiners is to reach a critical mass of people who understand Bitcoin and self-custody before it’s too late.

This is the race that we have to win and win fast. Time is not on our side—Godspeed.

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