Popular cryptocurrency activist and educator Andreas Antonopoulos responded to questions surrounding the numerous proposed Bitcoin ETF listings filed with SEC recently in the latest edition of his monthly Youtube Q&A series. Contrary to the opinions of most crypto enthusiasts, Antonopoulos stated that he believes Bitcoin ETFs are a “terrible idea”. Antonopoulos argues that Bitcoin ETFs present a number of problems to the cryptocurrency ecosystem, and would ultimately give too much control to institutional investors over the market.

Antonopoulos started building a following in the cryptosphere in 2012 when he abandoned his career as a freelance consultant and began speaking at conferences surrounding Bitcoin and cryptocurrency. Antonopoulos works as a private consultant for several blockchain startups and is host of the Let’s Talk Bitcoin Podcast. He is considered by many to be one of the leading thinkers in the space.

Suggested Reading: Learn more about Bitcoin in our ‘What is Bitcoin?‘ beginner’s guide.

The idea of a Bitcoin ETF has been gaining increased support within the cryptocurrency community, and indeed, even SEC Commissioner Hester Peirce, aka ‘Crypto Mom‘, has argued that a regulated Bitcoin ETF would help provide much needed regulation to the developing market.

Antonopoulos, however, has come out arguing that Bitcoin ETFs are not what the decentralized cryptocurrency market needs. Despite acknowledging that Bitcoin’s price would likely skyrocket following a Bitcoin ETF, as gold did when it became an ETF, Antonopoulos argued that Bitcoin would suffer overall because institutional investors would be given too much power in manipulating prices. The consequences of this would not just be limited to Bitcoin, but to the cryptocurrency market as a whole.

“I’m going to burst your bubble. I know a lot of people really want to see a Bitcoin ETF happen because ‘to the moon’ and Lambos and all of that, but I think its a terrible idea. I still think its going to happen, but it’s just a terrible idea… A Bitcoin ETF is going to be damaging to the ecosystem.”

Antonopoulos explains that a Bitcoin ETF is going to serve as a very large custodial holder of Bitcoin, which will hold Bitcoin on behalf of traders who buy shares. The problem is that ETFs strip away all the responsibilities and rights that a key-holding Bitcoin owner has. A Bitcoin holder has special rights like being able to cast votes surrounding governance issues on the platform, being able to select which exchanges hold their stored funds, and having the option to pick up coins during forks.

“ETFs fundamentally violate the underlying principle of peer-to-peer money where each user isn’t operating through a custodian, but has direct control of their money, because they have direct control of their keys,” said Antonopoulos.

Antonopoulos makes a compelling point. In a Bitcoin ETF, all of the shareholders’ consensus and governance voices would be given to the centralized fund managers in charge of the ETF. While Antonopoulos doesn’t think Bitcoin ETFs will ruin Bitcoin, he asserts that they will undoubtedly cause trouble with price manipulation and scaling decisions. He also warns that institutions managing Bitcoin ETFs might actively work to deter Bitcoin from improving its anonymity protections, a core value to many cryptocurrency supporters.

“A Bitcoin ETF is a multi-billion dollar ‘not your keys, not your Bitcoin’ vehicle,” concluded Antonopoulos. “That’s why I am against it.”

Despite Antonopoulos’ assumption that Bitcoin ETFs are likely to occur, there is a strong case to be made that such a thing may never happen. In an interview with CNBC earlier this month, CEO of Pantera Capital Dan Morehead pointed out that there appears to be a misconception among the public regarding the difficulty in having an asset class approved for an ETF. Morehead argues that we are likely not going to see a Bitcoin ETF anytime soon. He points out that historically, even traditional commodities like copper took years to acquire ETF approval.

“I still think it will be quite a long time until an ETF is approved. Copper has been on earth for 10,000 years, and it just got approved in 2012 after a very long multi-year process. I think ETFs in Bitcoin still have a long ways to go,” said Morehead.

The post Crypto Activist Andreas Antonopoulos Calls Bitcoin ETFs a “Terrible Idea” appeared first on UNHASHED.

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