Former BitMEX CEO Says Spot ETFs May Destroy Bitcoin
BitMEX co-founder Arthur Hayes recently claimed that the enterprise interest in Bitcoin can lead to a negative impact. He claimed that Wall Street firms may generate massive Bitcoin reserves and store them in metaphorical vaults. He opines that if Bitcoin spot ETFs gain traction it can lead to a decline in the trading volume of Bitcoin.
He started BitMEX in 2014 claiming in a blog post that Bitcoin retains value on account of active traders. As per his statement, spot Bitcoin ETFs can lead to massive asset vacuums and storage in a metaphorical vault.
One of his reservations is about miners who may lose incentive to verify transactions. Bitcoin ETF publishers may acquire a massive amount of BTC and store it in enterprise reserves. As per his projections, miners may have to halt mining machines on account of not receiving mining fees or rewards to verify various BTC transactions and outstanding expenses.
He retained that without miners Bitcoin may vanish. He exclaimed that under such an event, a new digital monetary network would be the next placeholder based on Satoshi Nakamoto’s vision of peer-to-peer e-money.
Major Reservations Regarding Bitcoin Spot ETFs
According to Hayes, if Bitcoin is fully adopted by state-backed firms investors may have to use other forms of digital transaction networks. As per his statement, people will learn to not share private keys with Wall Street firms. Hayes remarks arrived two weeks before the anticipated approval of Bitcoin spot ETF applications.
As per Bloomberg, analysts have set a timeline of 5th to 10th January for Bitcoin spot ETF approval. He noted in a recent tweet on 14th December that Bitcoin and altcoins are no-brainer choices considering the macroeconomic situation. He further noted that Bitcoin price investment with a view to upcoming momentum is a good position.
The former CEO of BitMEX opines that a Bitcoin price surge is imminent in the pretext of the Federal Reserve lowering interest rates in the upcoming year. He also projected a $1 million unit price prediction for BTC prices for 2024. CME Group has projected an 18.6% probability for upcoming interest rate cuts by FED during 2024.
There are mixed reviews and opinions regarding the impact of Bitcoin spot ETF in the industry but overall Bitcoin prices and traction have continued to ascend.
Bitcoin Mining Hash Rate Records New ATH
As per data from Blockchain.com, the Bitcoin hash rate recorded ATH on Christmas Day. The report indicates that the Bitcoin hash rate was noted at around 544 EH/s. The hash rate marks a more than 129% rise since January 2023. At the same time, Bitcoin prices have increased by 150% since the start of the year.
However, the report also suggests that total profitability for miners has declined. Statistics suggest that mining revenue decreased by 34% since recording ATH of $0.136 TH/s/day on 17th December for the year.
The situation has also led to an increase in trading fees. Glassnode analyst noted that Bitcoin noted that the network did not drain mempools which has led to additional fee pressure since February. Cointelegraph noted that Bitcoin hash rates surpassed the benchmark of 500 EH/s in November.
Meanwhile, Core Scientific one of the biggest mining firms recently reported that the project will emerge out of bankruptcy proceedings in January in a 21st December announcement.
