It wasn’t too long ago that the idea of Bitcoin and the wider cryptocurrency industry was a concept that was laughed at in traditional financial circles. The die-hard crypto enthusiasts knew of its potential shortly after it launched in 2009 – but it’s taken a long time for it to find its feet amongst traditional financial circles, hedge funds, and institutions.
The Bitcoin ETF has been discussed in the US for a long time, and although other countries beat them to the punch, all eyes were on the SEC earlier this year when the world’s most prominent investment company filed for one.
How Does An ETF Work?
An exchange-traded fund is a financial product that allows investors to access a collection of investments and securities rather than having direct exposure to the asset. For instance, if you purchase Bitcoin on a cryptocurrency exchange, you own the amount you’ve purchased, but this leaves you more susceptible to volatility – an ETF aims to offer a packaged introduction in the market, primarily aimed at first-time investors.
Although BlackRock owns the overarching asset—or whichever company you’re looking to invest with—this limits your exposure to the market. Bitcoin ETFs are traded as a share price and then on traditional stock exchanges. In turn, this grants traditional investors access to a product they may otherwise avoid, and it allows them to build a bridge toward potentially investing in cryptocurrencies like Bitcoin in the future.
The ETF Big Bang – Fueling The Gaming Industry
Many speculators believe this heightened market exposure could kickstart the sort of price action we witnessed during the 2021 bull run. Others are more reserved and believe that the idea of trillion-dollar asset management firms entering the space is a negative overall for the cryptocurrency community. It ultimately prides itself on decentralization and no one driving force behind the price of assets within the space.
Perhaps the better argument is that such exposure will mean that companies will be more open to the idea of exploring real-life use cases for cryptocurrency assets. For instance, cryptocurrency casinos are experiencing significant growth, and large institutions investing in Bitcoin are causing casino platforms to change their focus and identify potentially profitable ideas by allowing gamblers to withdraw and deposit via alternate currencies like Bitcoin on their sites.
Some casino providers have gone one better and made Bitcoin their entire unique selling point. Bitcoin gambling is one of the best use cases so far—it’s riding the coattails of a broader, burgeoning digital gambling sector. It is one of the easiest and most direct ways to highlight precisely the benefits of using Bitcoin to play a casino game to detractors or those who don’t understand Bitcoin.
Casino stocks have been moving nicely over the last 12 to 18 months, and with Bitcoin ETFs set to push the cryptocurrency market in a similar direction, it’s a no-brainer that the two worlds colliding could become one of the pillars and strongest arguments for mass adoption.
Other Use Cases Stemming From The Bitcoin ETF
It’d be unfair to suggest that the BlackRock ETF has become this crypto Big Bang moment – many companies within the industry have been working on mass adoption for the last decade. However, given that it propelled the price to new all-time highs earlier this year, there will inevitably be a host of companies looking to ride this momentum and try and bring crypto to the masses.
It’s impossible to avoid cryptocurrency investment and “trading strategies” if you are swept up in certain types of trading algorithms on social media. However, you only need to look at some of the broader cryptocurrency statistics to see that the industry as a whole has a long way to go before it can encourage traditional investors and traders to invest in it.
You should explore the mechanics of ETFs work before considering any level of investment. The same applies to any security, stock, or asset. ETFs are different from other similar-sounding products and should not be confused with funded trading accounts or mutual funds. Additionally, if you’re investing in cryptocurrencies or stablecoins, using a USDC calculator can help you understand the value of your investments in relation to the US dollar.
Final Thoughts
By exploring the wider benefits of blockchain technology that emerge from the heightened interest in Bitcoin via ETFs, companies are indirectly exposed to some of the advantages that lie ahead. Blockchain technology will change several industries, not just the casino gaming sector – it’ll go into areas of law, traditional finance, record storage, and identity verification.
The nature of blockchain and cryptocurrency means you can send assets to anybody in the world, usually within minutes; you do not have to worry about fees or payments that take days. Given that the blockchain underwrites and secures it all in an immutable block of data – many cryptocurrency and financial experts believe we’re only at the beginning of a journey that could see Bitcoin and cryptocurrency become an integral feature in society and finance over the next few decades.
