[HN Gopher] SEC Formally Accepts BlackRock Spot Bitcoin ETF Appl...
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SEC Formally Accepts BlackRock Spot Bitcoin ETF Application for
Review
Author : Malaalof
Score : 27 points
Date : 2023-07-16 19:21 UTC (3 hours ago)
(HTM) web link (decrypt.co)
(TXT) w3m dump (decrypt.co)
| neilv wrote:
| Can anyone summarize in layperson's terms any standards that
| these securities must meet?
|
| For example, is there a standard saying that the thing invested
| in must being legal? (No ETF based on illegal crack cocaine
| manufacturing, nor a fund based on illegal human-trafficking?)
|
| Is it OK if the thing is imaginary, but everyone just pretends it
| has value? (Even if Gold is sometimes treated as imaginary
| convenience, at least it's based on a physical commodity with
| industrial application.) (Edit: Other than fiat currencies backed
| by states.)
| coolestguy wrote:
| >Can anyone summarize in layperson's terms any standards that
| these securities must meet?
|
| No, not even the SEC & that's the cause of major court cases
| currently.
|
| In normal security offerings, there's disclosures coming from
| the issuing company about financials/profitability etc but
| btc/eth are peer to peer networks so there's no-one in the
| middle to do these things & it is very different to normal
| securities.
| FireBeyond wrote:
| > No, not even the SEC & that's the cause of major court
| cases currently.
|
| That's the spin of all the PR the crypto exchanges have put
| out.
|
| However, when it's time to put their money where their mouths
| are, they don't mention that there's no specific standards
| (because there is - the Howey Test).
|
| Coinbase, for example, has been very loud about this. "We're
| desperately asking the SEC to help us do this right and they
| won't!"
|
| Except their lawsuit says that they absolutely know how to
| "do this right", but...
|
| > for many tokens, registering is not possible due to effort
| involved, or not economically viable.
|
| i.e. Coinbase doesn't like the cost of having to register
| securities for the shitcoin du jour - there's no money to be
| made.
|
| But the SEC isn't obligated to make a profitable business
| model for Coinbase.
| jyap wrote:
| Something being illegal means you can't trade it legally.. so
| that doesn't make sense.
|
| It's like saying what age can you legally smoke? OK there's a
| legal age for smoking and cigarettes aren't banned. Then you're
| asking what age can you take illegal drugs? You can't, they're
| illegal.
|
| ETFs usually consist of legal equities, bonds, currencies, real
| estate, commodities.
| yreg wrote:
| >Is it OK if the thing is imaginary, but everyone just pretends
| it has value?
|
| Yes it's okay. When people pretend something imaginary has a
| value then it has a value. That's how money, bonds, deeds,
| loans, contracts, equity, etc work.
| thread_id wrote:
| Just what we needed. The largest legal crime syndicate in the US
| legalizing yet another scheme to suck money out the system. Most
| likely targeting public employee pension funds that for some
| reason beleive that they need to have risk exposure to all asset
| classes including the currency of choice for criminal
| transactions. Great.
| crtified wrote:
| Can you describe (simplified if necessary) the mechanism by
| which Blackrock would use this ETF to suck money out of the
| system?
| distortionfield wrote:
| > the currency of choice for criminal transactions
|
| Sorry, that title still belongs to the US Dollar.
| hellyer wrote:
| Can you elab on the legal crime by Fink's Blackrock?
| 0xedd wrote:
| Advocate for closure of nuclear plants in Germany and sign
| deal to fund coal company. All through shell corps, media and
| political brib... Sorry, campaign funds.
| s3p wrote:
| So now you can buy bitboin without actually buying bitcoin...
| wow. Expose yourself to all the volatility, all the harsh swings
| and market manipulation by crypto whales, all while owning _none_
| of the currency. Sounds awful.
| gberger wrote:
| Owning actual cryptocurrency is a huge hassle with concerns
| about key storage, hot vs cold wallets, etc. Investors are much
| more likely to already have the infrastructure in place to hold
| an asset like an ETF, so offering bitcoin wrapped in an ETF
| presents the opportunity to these investors to get exposure to
| crypto valuations without getting exposed to crypto hacks.
| Our_Benefactors wrote:
| > so offering bitcoin wrapped in an ETF presents the
| opportunity to these investors to get exposure to crypto
| valuations without getting exposed to crypto hacks.
|
| Every few years I hear about a bitcoin ETF and it seems like
| even worse of a scam than holding cryptocurrency directly.
|
| Clearly I'm too dumb (or too smart?) to understand how an ETF
| can tie itself to the value of bitcoin without also including
| a freely available redemption mechanism. Does it? If the
| value of my shares is equal to 1BTC (or whatever other cash
| out threshold), will they send Bitcoin to an address I
| specify? Is the ETF fully backed by bitcoin in a publicly
| auditable fashion?
| peyton wrote:
| No, AFAIK the fund sells shares to buy Bitcoin and sells
| Bitcoin to buy shares.
| rocqua wrote:
| There are a few parties (called Authorized Participants)
| who are allowed to mint ETF shares by handing the fund the
| underlying, or redeem ETF shares in return for the
| underlying.
|
| These APs are chosen carefully, and have the express job of
| creating liquidity. They make their money on arbitrage,
| thus keeping the ETF price closely matched to that of the
| underlying.
| modeless wrote:
| The answers to these questions and more are publicly
| available here: https://www.sec.gov/Archives/edgar/data/198
| 0994/000143774923...
|
| > An investment in Shares is: Backed by bitcoin held by the
| Bitcoin Custodian on behalf of the Trust.
|
| > Baskets may be created or redeemed only by Authorized
| Participants. Each Authorized Participant must be a
| registered broker-dealer, a participant in DTC, have
| entered into an agreement with the Sponsor and the Trustee
| (the "Authorized Participant Agreement") and be in a
| position to transfer bitcoin to, and take delivery of
| bitcoin from, the Bitcoin Custodian through one or more
| accounts. The Authorized Participant Agreement provides the
| procedures for the creation and redemption of Baskets and
| for the delivery of bitcoin in connection with such
| creations or redemptions. A list of the current Authorized
| Participants can be obtained from the Trustee or the
| Sponsor.
|
| This is all very standard and no more or less of a scam
| than other ETFs.
| jyap wrote:
| An ETF generally requires a redemption mechanism.
|
| In the case of the BlackRock ETF it's in the application.
| "Baskets may be created or redeemed only by Authorized
| Participants who pay BlackRock Investments, LLC".
|
| No you can't personally physically redeem the Bitcoin
| yourself. That's not the purpose and use of this ETF.
| coolestguy wrote:
| It's a spot etf
| jjtheblunt wrote:
| https://www.investopedia.com/terms/e/etf.asp
|
| https://www.investor.gov/introduction-investing/investing-ba...
|
| I think there's no buying X involved with an index ETF over X,
| in general, and I believe they are talking about an index etf
| here. (Of course, it still is some sort of gamble to trade in
| an index ETF.)
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(page generated 2023-07-16 23:02 UTC)