Nostr Web Client

wait i just realized that the reason the etfs dont "just buy a bunch of bitcoin ahead of going getting listed" is because they won't have access to the money to buy the coins until after people start putting capital into their funds (post-being listed)

i mean there's probably some initial capital investment happening, they call that 'market making', right?

still thinking about that tweet i saw about thousands of coins moving off kraken in batches this week. are things moving around ahead of a sale cycle?

this etf thing really has gotten my attention, and i dont know what to think about that. i'm really really curious about where these guys are planning to get their coins from, what are the logistics of their OTC agreements? who are they planning to buy from?

does coinbase have sellers lined up? have the mining companies been called? what's coinbase's take rate for helping their ETF customers close on bitcoin?

weird to think that bitcoin might soon be a rebirth for the 'broker-age' industry -- the person who can actually broker bitcoin deals about to be a rare beast? do they already exist or are we gonna see a whole new ecosystem of coin hunting get born?

Reply to this note

Please Login to reply.

Discussion

niftynei() 🇺🇸💸🧡 2y ago

when i worked at cashapp ages ago i got to meet the person on the team that was responsible for doing the exchange's OTC trades for keeping the bitcoin float at the right 'level'.

they exchanged buy/sell orders via an encrypted chat on messaging app.

the "float" was the margin of bitcoin on the books that belonged to cashapp. the goal was to have enough available so that any incoming buy order was immediately fulfilled, but not too much so that the org was over-exposed to the asset.

so there was a person on the team that bought and sold coins with a real-live trading partner to keep our 'float' where it needed to be

this was 6y ago now; i'm sure they have a different process in place. and i'm 99% sure they've rotated out their trading partner, as the one they *were* using back in the day is now in bankruptcy

buffalo 2y ago

supposedly they seed the funds a little bit and ahead of time as coin telegraph says

"BlackRock is reportedly planning to acquire $10 million worth of BTC as initial funding for its potential spot Bitcoin ETF, still currently under review for approval from the SEC."

Peter Todd 2y ago

It's risky as hell to buy a bunch in advance in case the ETFs get denied and the price drops.

Funds don't necessarily want to become traders.

Nathan 2y ago

Some if them got seeded with some amount if cash so they have been buying. But my guess is the buying has been done via OTC desks or maybe Coinbase (as that's their custodian).

But the real big flows will come post approval &

launch.

nymble 2y ago

it's publicly available the amounts they have pre-purchased. it's in the 100s of millions total

mambru 2y ago

Where can one see that?

BTC_P2P 2y ago

There is not enough Bitcoin for the Wall Street vampires. Not even close. The impending supply shock is going to be unreal.

ObjectiF MooN⚡️₿ 2y ago

What i'm sure of is that the suits won't have my #bitcoin

thor 2y ago

all the trade desks are set up and ready to go, only problem is no one literally no one talks about the economics of mining that is the final verdict on price

Baz. 2y ago

Mining doesn't determine price.

Price determines mining.

Baz. 2y ago

I curious about your perspective though.

Narwhal Tacos 2y ago

Personally I believe (not know, just believe) the various funds have been pursuing a Bitcoin ETF so patiently because their being hounded by their clients to do so. Thus they KNOW there is huge demand built up, like a dam retaining water.

They are likely also aware, as we Bitcoiners are, that 2024 looks extremely Bullish for Bitcoin.

So I believe they’ve been stacking for months now, which also increases the pressure they’re putting on the SEC to approve.

Also I’d add that Brokerages like Coinbase run OTC trading desks specifically to fund large client purchases. This is why Microstrategy or Tesla or whatever can make massive purchases (or sales) w/o moving the markets too significantly. The brokerages buy/sell in increments all day, every day, and move the assets off-the-books when an institutional client wants them.

So I believe all of these firms who’ve applied for an ETF have already been stacking. And in our current market they’re content to have done so because they’ll sell at huge gains. It’ll be very interesting to find out if they gauged initial demand correctly, or if they’ll quickly all find themselves in a bidding war to meet customer inflows.