Well, it’s been an honor front-running Wall Street with you all.
Last week, the $9 trillion asset manager BlackRock filed for a spot Bitcoin ETF with the SEC. Like clockwork, the game theory of it all plays out and we get subsequent filings for other spot Bitcoin ETFs from Fidelity, Schwab, Deutsche Bank, WisdomTree, etc., as well as Citadel and others filing for spot exchanges.
Wall Street is coming — albeit with rather convenient timing.
A week before the wave of tradfi ETF and exchange filings, the SEC sued Coinbase and Binance. I’m not coming to the defense of these shitcoin casinos that shill unregulated securities, but the timing is something to note.
It’s almost as if regulators spent 2021-2023 intentionally driving out crypto-native companies to clear the way for the more trusted tradfi institutions to come in and pick up the pieces.
Two friends here have the correct take:
Just six years ago (when BTC was $6K), BlackRock’s CEO Larry Fink called Bitcoin an “index of money laundering.” Today, his company files for a spot Bitcoin ETF.
You get Bitcoin at the price you deserve, or at the price you are willing to admit you were wrong about it.
BlackRock’s filing is that admission. Watch not what they say, but what they do.
So, what next?
Well, the floodgates of institutional flows have opened. People that were uncomfortable venturing into the Bitcoin market will be able to easily hold paper Bitcoin in their tradfi accounts.
Subsequently, I expect to see a bifurcation in bitcoin. There will be “clean” bitcoin that exists under the control and surveillance of Wall Street institutions, and “dirty” bitcoin that exists everywhere else.
BlackRock’s filing reads:
“The Sponsor will, …. use its discretion to determine which network should be considered the appropriate network … There is no guarantee that the Sponsor will choose the digital asset that is ultimately the most valuable fork.”
As Clark Moody points out, a BlackRock ESG fork of Bitcoin is incoming.
This gives BlackRock the optionality to push an “ESG-friendly” Bitcoin fork that would put them in control of that new network. Good luck getting anyone to join your dystopian walled-garden, Larry.
Who knows how this will all play out. It’s not even a certainty that these ETFs get approved any time soon. But it is shocking to watch the game theory play out in real time.
As I write this, Fed Chair Jerome says, “Crypto appears to have staying power as an asset class.”
“Crypto” meaning Bitcoin, the only truly decentralized commodity-money without a central issuer.
The engineering solution to the sovereign debt crisis we find ourselves in at the end of this long-term debt cycle.
A global form of money that does not require trust. As de-globalization trends continue to play out, the permissionless and trustless nature of Bitcoin will become more valued on the global stage.
Speaking of sovereigns — if the Wall Street dominos have fallen this fast, imagine how this will play out at the sovereign level once nations make public announcements.
Are you ready for the god candle, anon?
Russia is already mining. Instead of trading their scarce natural resources for a currency that can arbitrarily created at zero cost by a geopolitical adversary, they are trading their scarce natural resources for an absolutely scarce digital commodity that no one controls and that is mathematically designed to increase in purchasing power over time.
Bitcoin is for enemies. That’s the whole point!
We can’t stop Russia from using Bitcoin and BlackRock can’t stop us from using it.
It’s going up forever, Laura.
Recommended Reading:
The Bitcoin Standard: The Decentralized Alternative to Central Banking by Saifedean Ammous
This letter is for informational purposes only and is not financial advice.