The post Bloomberg analyst corrects key misconception appeared on BitcoinEthereumNews.com.

The choice of a “cash create” redemption model for spot Bitcoin (BTC) ETF as mandated by the United States Securities and Exchange Commission (SEC), has birthed some misconceptions in the industry, prompting Bloomberg’s Senior ETF Analyst James Seyffart to take out time to correct a few of these errors on the X app. Debunking Key Bitcoin ETF Myths With many of the applicants for the Bitcoin ETF product now succumbing to the SEC’s Cash Creates demand, it looks like members of the public believe adopting this redemption model means the fund will not hold Bitcoin.  Some others perceive that the Bitcoin ETF product will act as a fractional reserve product upon approval. However, Seyffart emphasized clearly that “Spot Bitcoin ETFs WILL hold Bitcoin.”  In response to this clarification, some crypto X members had several questions to ask including one individual who wanted to know if the ETF issuers will publish on-chain addresses so that the public can check and verify how the cash-create model works.  To answer this, Seyffart pointed to the fact that Osprey Funds published addresses for its OBTC offering. At the same time, he explained that this was not a strategy adopted by many ETF issuers.  Not working today but scrolling through twitter just now andddd holy hell… there are a lot of bad #bitcoin etf takes. People are simply uninformed (being nice) and wayyyy too gullible Say it with me: “Spot Bitcoin ETFs WILL hold Bitcoin” https://t.co/wZDJCYSfl6 — James Seyffart (@JSeyff) December 27, 2023 Another X user was more particular about getting a book that concisely explains how the entire Bitcoin ETF concept works, a demand Seyffart hilariously laughed at. Cash Creates and In-Kind Model: the Difference On the subject of cash create redemption and its counterpart; in-kind model, BlackRock had earlier explained the difference in…

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Filed under: News - @ December 28, 2023 10:28 pm