I don't understand how Blackrock would 'dominate' the spot market. Could Blackrock drive the #BTC price up if they needed BTC in trust to continue issuing Shares of a BTC #ETF? Is that domination? How would they harm me and my small holdings if they owned most of the BTC? This just seems more risky to ETF shareholders than me.
Discussion
This won’t harm you, it’ll make you much more wealthy. But it’ll make it hard for plebs to accumulate Bitcoin and that will be sad to see that window close.
Bitcoin spot price is set at the margin. So there is a small % of supply that is traded for spot price aka the “float” and this is where price is determined by the market.
When a huge buyer with mass capital enters the market they can easily corner the float bc of the disproportionate amount of capital vs everyone else. They will buy much of what is available and these relentless bids for a scarce asset will drive up price. Sellers will dwindle and it’ll take more fiat per Sat to find sellers over time.
In this situation the spot price will gap up dramatically and it’ll increase the purchasing power per sat dramatically as well. Good for hodlers, bad for anyone who is on zero bitcoin.
It’ll be more costly to tx on base chain as a Sat will have much greater value in open markets (imagine a 3000 Sat tx having a spot value of $10 instead of $1).
At this point regular ppl will have a harder time acquiring UTXO’s bc they’ll be a lot more expensive and tx’s for smaller amounts will be uneconomical. So the days of $10 buys will be over.