A crypto ETF has been a long-awaited affair, and now, finally, the first one is to start operating from next week in Switzerland. Five of the top cryptos will be traded on it: bitcoin (Bitcoin), ethereum (ETH/USD), litecoin (LTC/USD), bitcoin cash (Bitcoin.Cash), and ripple (XRP/USD).
Amazing! Switzerland has just approved the first crypto ETF!— John Ðough (@RealJohnDough) November 17, 2018
"The Amun Crypto ETP, which will start trading next week on the SIX exchange in Zurich, has been designed to track an index based on the movements of five leading cryptocurrencies."#cryptocurrencies #BTC #ICO
The crypto ETF talk has been going on for quite some time, with many within the community seeing this as a move forward towards the mainstream adoption of cryptocurrencies.
This is because of the fact that most of the power is concentrated in the traditional finance sphere, especially in banking. Thus, it is believed that when that colossus starts to shift its weight then more people will start to trust the crypto sphere. For many, the traditional finance sector seems to be something stable and trustworthy, however as we all know this isn’t exactly the case. The financial sphere has been known to lose its footing, stumble and fall. Every and any global crisis is an example of this. Nevertheless, the ‘ordinary’ person, be it because of a lack of understanding or awareness, isn’t ready to trust crypto over fiat currency, and there are many examples of this mistrust around.
Histrionic, but I'll bet it's mostly true. Crypto-currencies don't deserve your trust. https://t.co/9mGaYPhJ6r— Dan Gillmor (@dangillmor) November 16, 2018
Still, many believe, and even more, are slowly realizing that crypto is the way of the future, hence we are able to see how massive players on the market are getting into or starting to support blockchain technologies and cryptocurrencies. Such huge companies as HSBC, Goldman Sachs, Google & Samsung, an array of oil & gas companies, and many others have all either invested in blockchain or attempted to start implementing this technology themselves.
But, returning to the soon-to-open ETF. Why has the community been so hyped up about the whole endeavor?
In short, an ETF or exchange-traded fund is a company managed pot of investments shares of which can be bought and according to its performance the customers either win or lose money. The U.S. has been strongly opposed to the idea of a bitcoin ETF, and doubt has been expressed as to when such an endeavor will be given the green light by SEC. But, possibly if all goes smoothly with the Swiss Amun ETF, then the SEC might revisit this matter and change its opinion on the whole crypto ETF business.
And the belief is that a crypto ETF is a step forward towards mainstream crypto adoption. It makes sense, the more ways there are in using digital currencies and profiting from them, the quicker they will turn into a mainstream phenomenon. However, some believe that ETF’s aren’t what we should be striving for and that there are more pressing matters. One such person is ethereum’s Vitalik Buterin:
I think there's too much emphasis on BTC/ETH/whatever ETFs, and not enough emphasis on making it easier for people to buy $5 to $100 in cryptocurrency via cards at corner stores. The former is better for pumping price, but the latter is much better for actual adoption.— Vitalik Non-giver of Ether (@VitalikButerin) July 29, 2018
This is not to say that Burtin views an ETF as something negative, simply that in his opinion it shouldn't be the crypto communities priority. And from recent news, we can see that moves in the direction of a crypto card are also being made, albeit that it's still not in the form that Buterin envisions it.
Now only time will tell when the fund starts its operation in a week whether a crypto ETF was what the community needed and whether it will bring new people to the crypto sphere.
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