On January 17, in thread published on social media platform X, crypto analyst Joe Burnett and others weighed in on the launch of eleven SEC-approved spot Bitcoin ETFs, including a notable one from BlackRock. The conversation unfolded with a mix of humor and critique, reflecting the complex relationship between traditional finance and the burgeoning world of cryptocurrency.
Burnett kicked off the discussion with a metaphor, likening owning a spot Bitcoin ETF to having a girlfriend who resides in BlackRock’s apartment. The twist? BlackRock only sends you her photo every quarter, adding a layer of detachment to the ownership experience. This analogy humorously highlights the indirect nature of ETF ownership, where investors have a stake in Bitcoin but lack direct possession.
Expanding on this analogy, Burnett added a financial twist: BlackRock charges a fee for taking care of this metaphorical girlfriend. This comment points to the fees associated with ETFs, a common aspect of managed investment funds, but one that stands in stark contrast to the typically lower cost of direct cryptocurrency ownership.
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Alex Thorn, Head of Research at Galaxy Digital, chimed in with a technical correction. He suggested that investors actually receive a “picture” (metaphorically speaking) from the previous night every morning. Thorn’s remark subtly underscores the daily reporting typical of ETFs, providing a more frequent update than Burnett’s initial quarterly depiction.
BitMEX Research contributed to the conversation with a more critical take. They described receiving a nightly picture around 3 AM, but with an ambiguity about whether the image was taken one or two days prior. Moreover, they highlighted the cost of a terminal required to receive these updates ahead of others, a nod to the expensive Bloomberg terminals often used in traditional finance. The $36,000 annual cost for such a service starkly contrasts with the open and often low-cost access associated with direct cryptocurrency dealings.
Featured Image via Pixabay
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- Source: https://www.cryptoglobe.com/latest/2024/01/owning-a-bitcoin-etf-is-like-saying-you-have-a-girlfriend-but-she-lives-in-blackrocks-apartment-says-analyst-joe-burnett/
