BitMEX Co-founder Cautions Against Spot Bitcoin ETFs

• In a recent blog post, Hayes said that Bitcoin’s worth is due to the fact that “it moves.”
• There will be a dramatic drop in network activity and miners’ motivation as per Hayes.

The ex-CEO and co-founder of BitMEX is warning that spot Bitcoin ETFs, should they become too popular, may “completely destroy” Bitcoin.  In a recent blog post, Hayes said that Bitcoin’s worth is due to the fact that “it moves.”

Spot Bitcoin ETFs, on the other hand, are designed to “vacuum up assets” and “store them in a metaphorical vault,” as he put it.

Risks Highlighted

There will be a dramatic drop in network activity and miners’ motivation to validate transactions if Bitcoin ETF issuers and investors choose to purchase Bitcoin derivatives instead of hodling the cryptocurrency. When miners can’t afford to keep their equipment running, they shut them down. The network crashes and Bitcoin disappears because of this, as per Hayes.

A new digital monetary network would replace Bitcoin and go beyond Satoshi Nakamoto’s initial idea of decentralized electronic currency, according to Hayes’s intriguing speculation. According to Bloomberg analysts, all outstanding applications for spot Bitcoin ETFs are expected to be approved between January 5 and 10, 2024. Hayes’ Bitcoin thoughts arrive only two weeks before that date.

The SEC has not yet made a judgment on the spot Bitcoin ETF applications from several financial giants. However, firms who have submitted their final S-1 amendment forms by the next deadline of December 29, 2023, will be the only ones included in the first wave of possible spot Bitcoin ETF issuers, according to the SEC. Importantly, the first wave of applicants will not be considered if they miss this critical deadline.

Bitcoin is now trying to break out of the $43,500 psychological level. At the time of writing it is trading around $43,123 after encountering a bearish barrier.

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