Anyone and everyone can get exposure to bitcoin today, without a spot ETF. Once ‘institutions’ have that exposure and custody over all those bitcoins are they going to magically give it up and encourage self-custody and a trustless system after step 1 in the multi step process?

I don’t think so. I think it sets Bitcoin back in the long run to allowing truly censorship resistant money for anyone and everyone in the world. Locking up that much bitcoin in the hands of our traditional financial system isn’t how bitcoin was meant to be used according to this - “A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution.”

I hope I’m wrong though.