What is ETF?
Is Bitcoin ETF the same as Blockchain ETF?
ETF stands for Exchange Traded Funds. These mutual funds can be purchased and sold in stock exchanges during the trading hours. So this is actually quite normal in the stock market.
How can it be useful for Bitcoin? As you can imagine, due to security problems or price manipulations, large investors do not invest in the crypto market and stay away. If the ETF is approved for Bitcoin, the volatile market will become more normalized and problems will be reduced to a minimum and larger investors will be more likely to invest in Bitcoin.
For a better understanding, let’s look at the application of CBOE (Chicago Board Options Exchange). The proposal of CBOE will include a new company and all the capital of this company, except for the basic expenses of Bitcoin. Each investor will have 5 shares worth at least 25 Bitcoins. The company will also stock 25 Bitcoins for every 5 shares sold. As you can imagine, the prices of this company’s shares will be determined by the Bitcoin price.
Bitcoin ETF application is not only made by CBOE but also by other companies. Although no serious step has been taken yet, we have the “Blockchain ETF”.
A remarkable difference of Blockchain ETF is that it does not invest Blockchain-based cryptocurrency or sub-code, but can apply Blockchain technology to their sectors instead. At this point, the company is creating new foundations with Blockchain technology or establishing new startups unattached from an old company that introduces block application technology to its main applications.
Blockchain ETF is a more stable investment compared to Bitcoin ETF, given that Bitcoin does not follow current market activity and instead invests in companies’ workforce.
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Investment information, comments and recommendations contained herein are not included in the scope of investment advisory. Therefore, making an investment decision based solely on the information and comments contained herein may not produce results that are in line with your expectations.