After 10 hard years of trying to get the Bitcoin ETF approved, we finally got it. It happened exactly 15 years after Hal Finney's 'Running Bitcoin' tweet. For the people who pioneered, believed in and used crypto, it's a big day. They got vindication. Bitcoin ETF is a triumph of blockchain technology. Approval from the SEC legitimizes the entire crypto industry. ETFs are positive for crypto, but there are also a few negatives. However, approved Bitcoin ETF is also positive for Cardano and other blockchain projects.
Crypto Is Legit
Many people see the approval of the Bitcoin ETF as opening the door for institutions to buy BTC. From my point of view, the legitimization of technology is more important. Bitcoin is paving the way for an entire industry. I believe we will soon see more requests for ETFs. The SEC is very likely to approve them.
One of the biggest obstacles to the adoption of cryptocurrencies was considered to be regulations and the unclear attitude of various institutions. The SEC has given the green light to Bitcoin, which means that attempts to ban it will stop. Of course, we are only talking about the USA.
The USA has always been the cradle of innovation. If one of the most important states on the planet adopts blockchain technology, other states cannot just observe. They will have to join.
The SEC considers many crypto projects to be securities. We can expect that they will continue to fight against various projects. However, this fight will seem very disproportionate and unconvincing in light of the approved ETF. The SEC is now in a much more difficult situation. I expect it will be forced to approve more ETFs. It will be easier for crypto projects to defend themselves in court if it goes this far.
We may see some nasty moves from the SEC against Cardano and the crypto industry. But the SEC is not the only institution in the US. Many authorities have repeatedly expressed disappointment with the SEC's actions. The SEC will have to be more careful in what it does.
ETF vs. Self-custody
ETFs require trust in a third party. Institutions can lie about how many coins they hold, or they can fail in some way. This is not in line with Satoshi's vision.
Somewhat paradoxically, this is a certain way of centralizing technology that was supposed to bring decentralization to the world. In other words, ETFs make people mere investors and isolate them from blockchain networks.
In my view, Bitcoin ETF opens the door to institutions but has a neutral to negative impact from an adoption perspective. In addition, people who are not interested in investing probably have no idea what is hidden behind the acronym ETF.
Institutions offering ETFs should implement proof of reserve. However, using a self-custody wallet should be the preferred option for people.
The mission of cryptocurrencies is to create a system that is not dependent on intermediaries who can abuse their position. That still applies. Holding BTC through an ETF is the way for some, but regular users should keep crypto in their self-custody wallets, not necessarily just for sovereignty and freedom, but also for the ability to use networks and DeFi. This is unavailable to them through ETFs.
The success of cryptocurrencies is dependent on the use of peer-to-peer networks and services. If people only see and use crypto as an investment asset, I would consider it a missed opportunity. On the other hand, it would be enough for many people. It might even suit banks, as they would have fees for crypto services and would not be directly threatened by blockchain technology.
It stands to reason that many institutions only hold and trade cryptocurrencies. It's a business for them. This is only the beginning.
An approved ETF can move us forward in the longer term. Blockchain will become more used to tokenize assets and build DeFi. Only at this point does the real revolution begin. USD tokenization is working. It is only a matter of time before other real-world assets are tokenized.
BlackRock even released a report in which it is written that tokenization is the future of the financial sector. An approved Bitcoin ETF moves us closer to this. This could be a big step towards replacing legacy financial systems.
The Best Is Yet To Come For The Crypto Industry
An approved Bitcoin ETF is proof of the power and potential of cryptocurrencies. It's just the beginning of disruption and adoption. Now everyone should think about what will happen next and where the crypto industry is going.
Cardano is being built as a global financial and social operating system. The mission of the project is known from the beginning and its fulfillment will now be easier.
Financial services on the blockchain may soon be more than just services for early adopters and tech geeks. As soon as more ETFs are approved and the started regulations are completed, we can start seriously talking about mass adoption that is not hindered by various authorities. Industry must move on. Everyone expects further technological progress and innovation from it.
Bitcoin has already won many battles in its history. ETFs have been waiting a decade for approval. This win is significant. Many people rejoice. Once the celebrations are over, it is necessary to continue building. For all teams, crypto foundations, fans, and developers, it is a motivation to continue their efforts. The future seems bright.
Some people argue that the crypto industry didn't need any ETFs. They expected a revolution from crypto without the participation of states. Some even wanted to replace central banks. These people may be a little disappointed that crypto is becoming institutionalized and getting the go-ahead from states. There's probably nothing you can do about it. It's a natural progression. There is still a chance that these ambitious expectations may come true in the future, only the path will be different. A gradual evolution is better than a sudden revolution.