Bitcoin ETF’s Rising Popularity: Analyzing the Concerns of Vulnerability and Market Manipulation

The prospect of a Bitcoin exchange-traded fund (ETF) has been creating waves in recent times, contributing to the cryptocurrency's growing valuation. However, not everyone is on board with this development. Critics argue that a spot Bitcoin ETF could expose the cryptocurrency to vulnerabilities akin to those experienced in the gold and silver markets. They fear that the approval of such an ETF might pave the way for manipulative practices reminiscent of those associated with precious metals.

Physical Bitcoin ETF: The Fear of Gold-like Manipulation

On the surface, a physical Bitcoin ETF might appear to be a positive development for the cryptocurrency's growth and valuation. But concerns have been raised about the potential for it to replicate the issues seen with gold and silver ETFs, where fictional supplies of BTC could be used as leverage for futures. Critics argue that instead of acquiring actual Bitcoin, investing in a Bitcoin ETF would not decrease the real supply. This could potentially allow ETF operators to leverage positions significantly beyond their verifiable assets, thereby influencing price movements.

Bitcoin ETF: A Threat to Bitcoin Adoption?

Josef Tětek, a Bitcoin analyst at Trezor, made a controversial statement on October 16, 2023, declaring that an "ETF is fiatization of Bitcoin." He voiced concerns that an ETF might not be beneficial for Bitcoin in the long term. Tětek argued that a Bitcoin ETF could impede Bitcoin adoption and undermine the principle of self-custody, replacing actual usage of the cryptocurrency with mere price speculation.

The Dark Side of ETFs: A Historical Perspective

The first gold exchange-traded product (ETP) was introduced in 1961 as a closed-end fund. Since then, ETFs and financial powerhouses have been accused of manipulating precious metal prices. Critics fear that a Bitcoin ETF could enable similar manipulative practices. For instance, corporations might leverage fictitious supplies to hedge vast derivative bets, releasing this illusory supply to counter sudden price surges.

The Spot Bitcoin ETF Debate: Concerns and Counterarguments

While Bitcoin ETFs might democratize access to the cryptocurrency, critics argue that they could also facilitate leverage and speculative practices, potentially distorting price discovery. Some Bitcoin enthusiasts have even described the ETF as "the best State attack on Bitcoin." However, others dispute this perspective, suggesting that the decentralized nature of Bitcoin will ultimately triumph over any attempts at control.

The Future of Bitcoin ETFs: A Matter of Perspective

The approval of a spot Bitcoin ETF has been viewed as potentially beneficial for short-term traders, with prices predicted to skyrocket. However, there are concerns that this could be detrimental for small retail Bitcoin investors, as they might not see the actual price level again once institutional investors step in. Regardless of the differing views, the debate over Bitcoin ETFs has highlighted the complexities and uncertainties surrounding the future of cryptocurrencies.

Frequently Asked Questions

How to Open a Precious Metal IRA?

It is important to decide if you would like an Individual Retirement Account (IRA). Open the account by filling out Form 8606. For you to determine the type and eligibility for which IRA, you need Form 5204. This form should be filled within 60 calendar days of opening the account. Once this has been completed, you can begin investing. You might also be able to contribute directly from the paycheck through payroll deduction.

To get a Roth IRA, complete Form 8903. Otherwise, the process is identical to an ordinary IRA.

To be eligible for a precious metals IRA, you will need to meet certain requirements. The IRS stipulates that you must have earned income and be at least 18-years old. For any tax year, your earnings must not exceed $110,000 ($220,000 for married filing jointly). Contributions must be made on a regular basis. These rules apply to contributions made directly or through employer sponsorship.

An IRA for precious metals allows you to invest in gold and silver as well as platinum, rhodium, and even platinum. However, you can't purchase physical bullion. This means you can't trade shares of stock and bonds.

Your precious metals IRA can be used to directly invest in precious metals-related companies. Some IRA providers offer this option.

An IRA is a great way to invest in precious metals. However, there are two important drawbacks. First, they aren't as liquid than stocks and bonds. It is therefore harder to sell them when required. Second, they don’t produce dividends like stocks or bonds. Therefore, you will lose money over time and not gain it.

Should You Buy or Sell Gold?

Gold was once considered an investment safe haven during times of economic crisis. Many people are now turning their backs on traditional investments like stocks and bonds, and instead look to precious metals like Gold.

The gold price has been in an upward trend for the past few years, but it remains relatively low compared with other commodities like silver or oil.

Some experts believe that this could change very soon. They believe gold prices could increase dramatically if there is another global financial crises.

They also mention that gold is becoming more popular due to its perceived worth and potential return.

Here are some things to consider if you're considering investing in gold.

  • The first thing to do is assess whether you actually need the money you're putting aside for retirement. It is possible to save for retirement while still investing your gold savings. However, you can still save for retirement without putting your savings into gold.
  • Second, ensure you fully understand the risks involved in buying gold. Each one offers different levels security and flexibility.
  • Remember that gold is not as safe as a bank account. Losing your gold coins could result in you never being able to retrieve them.

So, if you're thinking about buying gold, make sure you do your research first. You should also ensure that you do everything you can to protect your gold.

Is physical gold allowed in an IRA.

Not just paper money or coins, gold is money. People have been using gold for thousands of years to store their wealth and protect it from economic instability and inflation. Today, investors use gold as part of a diversified portfolio because gold tends to do better during financial turmoil.

Many Americans today prefer to invest in precious metals, such as silver and gold, over stocks and bonds. Although owning gold does not guarantee that you will make money investing in it, there are many reasons to consider adding gold into your retirement portfolio.

One reason is that gold historically performs better than other assets during financial panics. Gold prices rose nearly 100 percent between August 2011 and early 2013, while the S&P 500 fell 21 percent over the same period. During these turbulent market times, gold was among few assets that outperformed the stocks.

Another advantage of investing in gold is that it's one of the few assets with virtually zero counterparty risk. You still have your shares even if your stock portfolio falls. If you have gold, it will still be worth your shares even if the company in which you invested defaults on its debt.

Finally, gold offers liquidity. You can sell your gold at any time without worrying about finding a buyer, which is a major advantage over other investments. It makes sense to buy small quantities of gold, as it is more liquid than other investments. This allows for you to benefit from the short-term fluctuations of the gold market.


  • The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (
  • This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (
  • You can only purchase gold bars at least 99.5% purity. (
  • Contribution limits$6,000 (49 and under) $7,000 (50 and up)$6,000 (49 and under) $7,000 (50 and up)$58,000 or 25% of your annual compensation (whichever is smaller) (
  • Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (

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The History of Gold as an Asset

From the beginning of history, gold was a popular currency. It was popular because of its purity, divisibility. uniformity. scarcity and beauty. Due to its value, it was also internationally traded. Because there were no internationally recognized standards for measuring and weighing gold, the different weights of this metal could be used worldwide. One pound sterling in England was equivalent to 24 carats silver, while one livre tournois in France was equal 25 carats. In Germany, one mark was equivalent to 28 carats.

The United States started issuing American coins in the 1860s made of 90% copper and 10% zinc. This led to a decrease of demand for foreign currencies which in turn caused their prices to rise. The United States began minting large quantities gold coins at this time, which led to a drop in the price. The U.S. government was unable to pay its debts due to too much money being in circulation. They decided to return some of the gold they had left to Europe.

Because most European countries did not trust the U.S. dollar, they started accepting gold as payment. Many European countries began to use paper money and stopped accepting gold as payment after World War I. The value of gold has significantly increased since then. Although the price of gold fluctuates today, it remains one of your most safe investments.

By: Jamie Redman
Title: Bitcoin ETF's Rising Popularity: Analyzing the Concerns of Vulnerability and Market Manipulation
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Published Date: Fri, 20 Oct 2023 18:00:50 +0000

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