The Crucial Role of U.S. Manufacturing in Bitcoin Spot ETFs: Arthur Hayes Explores the Buyer-Seller Dynamics
As various asset management companies have submitted modification documents for Bitcoin spot ETFs supported only by “cash” mode, they are eagerly waiting for approval in January. BitMex founder Arthur Hayes also expressed his opinion, claiming that the cash mode is more complex. He even bet that only brokers and exchanges with political backgrounds can become counterparties for BTC trading. Does even the ETF require “Made in the USA”?
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Arthur Hayes: The Key to Buying and Selling Bitcoin
BlackRock and others comply with SEC and switch to cash mode ETFs
Arthur Hayes pointed out that the physical mode is simpler and cleaner for funds, as they do not have to direct BTC trades, but this also means that BTC can be purchased from anywhere.
Cash is more complex, but it gives funds significant power. Fund trading desks will have immense power to direct large flows of BTC trades. Considering the spirit of the political era of “Made in the USA,” Hayes bet:
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Only brokers and exchanges with political backgrounds will be used as counterparties for purchasing BTC for this fund.
He also proposed that because ETFs have trading time restrictions, the creation/redemption window will also close at 4 p.m. Eastern Time on Friday in the United States. Will there be changes in market microstructure? Will the price discovery shift from the East to the West? These will be the details he will observe in the future.
And he believes that this will bring lucrative arbitrage opportunities for those who can trade on BTC exchanges in the United States and non-U.S. countries.
With the Christmas holidays approaching, various asset institutions have been intensively meeting with SEC officials to discuss the details of Bitcoin spot ETFs and have been submitting new S-1 amendments one after another, including BlackRock, Valkyrie, Bitwise, and Invesco, all of which have proposed amendments that only allow creation and redemption in cash. Everyone seems to want to “seek first to have, then seek to improve,” and strive to take the lead in the next approval window in January.
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Illustration of ETF: SEC’s preferred cash mode ETF, how is it different from BlackRock’s physical Bitcoin ETF?
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Arthur Hayes
BTC
Bitcoin spot ETF
Further reading
CryptoQuant analysis: Short-term correction risk for Bitcoin, expected to reach $160,000 by 2024
January approval is a must? Bitcoin spot ETF has become BlackRock’s “key priority”
