The demand for Bitcoin ETFs (Exchange-Traded Funds) has skyrocketed in the past few months. Moreover, while a huge part of the world is asking for it, Andreas Antonopoulos – blockchain advocate, open-source consultant and Bitcoin Lightning Network expert – believes the outcome will eventually be catastrophic if Securities and Exchange Commission (SEC) allows that to happen.

Earlier this year, Bitcoin ETFs have been among the hottest topics crypto-enthusiasts look forward to. Five of the biggest global investment firms, namely ProShares, Bitwise, Direxion, Solidx, approached the SEC with individual proposals to launch Bitcoin ETFs.

One of the primary reasons why such investment giants believe Bitcoin ETFs could be crucial for the market is that the mass reach of Bitcoin is enormous and an obvious solution that allows Bitcoin ETF purchase could rope in a considerable number of investors. Imagine the popularity of Bitcoin ETF combined with traditional ETFs when the latter is already among the most popular financial instruments. Apart from that, due to their diversified portfolio, ETFs have smaller risk factor while offering regulatory accountability from apex authorities at the same time.

However, Andreas Antonopoulos has a different angle on the matter. He talks about how the fundamental nature of cryptocurrencies, especially Bitcoin, restricts the full-fledged functionality of ETFs based on the same. The expert elaborates that even though the issuer of such funds may act as a keeper of Bitcoin, it does not actually transfer ownership as there are no private keys involved. In other words, they can only hold ownership over the fund, but not over the underlying asset, unlike traditional ETFs. Another perspective Antonopoulos wants the world to see is how ETFs will undermine the very purpose of Bitcoin and other cryptocurrencies with centralisation.

Andreas Antonopoulos is one of the most followed open-blockchain aficionados. During his early career, Antonopoulos consulted businesses on open-source and open networks, conducted many researches over computer security, and has worked with Blockchain.info as a chief security advisor.

In July 2018, SEC rejected the second Bitcoin ETF application from Gemini crypto exchange owned by Cameron and Tyler Winklevoss and postponed that by VanEck Solidx Bitcoin Shares to September 2018. However, the commissioner of SEC has clarified the apparent change in the stance of the regulatory body, stating that SEC should see this opportunity from the ETF market perspective and not from that of the underlying asset.

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