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“With ETFs, Bitcoin loses self-custody and monetary sovereignty”

Important facts:
  • For D. María, the introduction of Bitcoin-based investment instruments is about to begin.

  • Despite the enthusiasm for ETFs, he is concerned about the opposite results to Bitcoin philosophy.

There are two sides to every story and this is also a reality with spot Bitcoin exchange traded funds (ETFs). On the one hand, these investment instruments lead to greater acceptance; On the other hand, they also represent the capitulation of self-custody and monetary sovereignty, which are part of the philosophy of digital currency.

This is the thought of the Spanish lawyer and philosopher Álvaro D. María, who He participated in a live broadcast by analyst Juan Ramón Rallo this week. The specialist remembers this when investing in a possible Bitcoin ETF The authority to manage the custody of the cryptocurrency is lost and decentralization is also foregone.

D. María argues that these options are abandoned in favor of long-term profit, “which brings us to a value that is not even stable over time.” However, he admits that ETFs have a number of advantages.

In this context, the lawyer highlighted Bitcoin as a savings mechanism, a property that follows from the fact that the supply of this asset is finitehas anti-inflationary properties, is fungible and also safe.

Bitcoin specialists debate Bitcoin ETFs. Source: Juan Ramón Rallo.

According to the researcher, these characteristics become clear with the introduction of ETFs as investment instruments. They will also be reflected in the increasing prevalence of professional custody activities by banks. and the integration of banking into the BTC business.

D. María met with the engineer and Bitcoin engineer Manuel Polavieja, who also attended Streamingand reinforced the idea that by choosing to invest in Bitcoin ETFs “Custody is left to a third party and the ability for monetary sovereignty is lost.” However, he also acknowledges that the topic of Bitcoin self-custody is a “complex” issue that is not for everyone.

He reminded that self-custody can work no matter how private Bitcoin is The person must learn to follow a series of measures. This includes the responsibility to effectively protect wallet seed phrases.

They expect demand for Bitcoin to increase

On the other hand, Polavieja emphasized that Bitcoin ETFs are nothing more than the direct expression of increasing demand for this decentralized asset. He adds that if the financial industry becomes interested in BTC, “That’s because his customers demand him.”

Lawyer Álvaro D. María agrees with the latter, recalling that the banking sector At the time, he even ran away from Bitcoin due to the emergence of other cryptocurrency projects. “Just after all these alternative projects to Bitcoin have failed and it is understood that BTC is something different, banks are starting to venture into it,” said the Spanish Bitcoiner.

The statements by Mr. María and Polavieja come in a context in which investors have been eagerly awaiting the decision on some BTC spot ETF applications in the United States for several weekswhich for some is an imminent event that will provide greater impetus to the bull market.

BlackRock, Valkyrie, Wisdom Tree, ARK Invest and eight other companies are awaiting the Securities and Exchange Commission’s (SEC) decision on their applications to issue the financial vehicle. It is estimated that the federal authority will be finalized in January 2024 Say whether you agree to the launch or not of Bitcoin spot ETFs.

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