There’s a lot of chatter about the brave new world of crypto ETFs. So, what’s going on?

[Bitcoin](/coins/btc) (BTC) and [Ethereum](/coins/eth) (ETH) are two of the most popular and heavily capitalised cryptocurrencies on the digital assets market today. Both have gained a reputation for being a starter home of sorts for new investors who are finally ‘ready and willing’ to take their first steps into the world of cryptocurrency investing.

Cryptocurrencies have gone an a remarkable run these past two quarters and while many investors remain wary of the market hysteria, they can also benefit from its innovations. In terms of investment opportunities, the proliferation of new cryptocurrency exchange traded funds (ETFs) has further simplified (and accelerated) the adoption of digital currency investments among newcomers to the digital assets market.

## The History of ETFs

ETFs are a widely adopted strategy used by investors who want to ‘diversify’ their exposure to a particular industry, class, or sector. They were first introduced in the 1990s and rapidly gained popularity with _individual_ investors for their simplicity.

The first Bitcoin ETF in the US started trading on October 19, 2021, and now several crypto ETFs have followed suit. Some of them offer access not only to Bitcoin, but also Ethereum and other popularly traded coins.

### Here are examples of crypto ETFs setting the trends:

[ProShares Bitcoin Strategy ETF](https://www.proshares.com/funds/bito.html) (ticker: BITO)

Kiplinger has officially called the ProShares Bitcoin Strategy ETF ‘[a blockbuster](https://www.kiplinger.com/investing/etfs/603621/proshares-bitcoin-strategy-etf-bito)’. A fitting name for an ETF that successfully attracted a mind-boggling $1 billion of investors’ money over the course of 48 hours after the ETF was launched. The BITO ETF is historical in the sense that it was the first crypto ETF that the Securities and Exchange Commission allowed to trade on a major US exchange. At present, the BITO ETF has close to $1.5 billion in assets.

[Grayscale Ethereum Trust](https://grayscale.com/products/grayscale-ethereum-trust/) (Ticker: ETHE)

For investors willing to invest outside the ‘safety’ of Bitcoin, Grayscale offers their Ethereum Trust ETF. Widely recognised as the number two cryptocurrency, Ethereum came to fruition once people began to realise that Bitcoin’s blockchain technology could be utilised in myriad ways. Voila! The world found the second most popular digital token – Ethereum. As the name would suggest, this ETF seeks to track the ETH market price and presently has $14.5 billion in assets.

[Bitwise 10 Crypto Index Fund](https://www.bitwiseinvestments.com/funds/Bitwise-10) (Ticker: BITW)

For those with an appetite for more risk, this ETF is the world’s first crypto _index_ fund offered to provide investors with a way to get more exposure to the crypto market _beyond_ what Bitcoin alone may offer. Earlier this summer, it was reported that Bitcoin’s share of the total market capitalisation of the crypto market fell from 69% to 42% as other assets like Ethereum, Cardano and Solana have grown in popularity. Bitwise says it screens the fund’s holdings for certain risks and rebalances it monthly. While Bitcoin and Ethereum both have a role to play in this ETF, additional holdings include digital assets such as Algorand and Uniswap. The BITW fund has $1.4 billion in assets.

Investors that are looking for space in between the world of traditional stock investing and the wildly innovative and volatile ecosystem of cryptocurrencies may find what their looking for in the expanding market of crypto ETFs.

The Brave New World of Crypto ETFs

The crypto market took another tumble today as prices fell just hours after reaching all time highs.

Bitcoin, along with many other top tier cryptos, experienced a price shock Wednesday afternoon when prices plummeted just hours after achieving all time highs.

Bitcoin hit a price high of $68,744 ([Coinmarketcap.com](https://coinmarketcap.com/)) before falling sharply to $64,050 in less than four hours. The price shock was felt across the board with other major crypto experiencing similar pain. Ethereum fell from $4,858 to $4,538 whilst current market darling Solana dropped from $247.80 to $222.33.

Many commentators were quick to blame Chinese property developer Evergrande Group and its frantic attempts to avoiding defaulting on their bond payments but on closer inspection this does not appear to be the culprit. While the domino effect that a massive debt default may cause the worldwide financial markets is certainly cause for concern, for those who are well versed to the unregulated crypto wild west Wednesday’s average 8% pull back was nothing new.

## Crypto Market Recovery Position

The real question investors are asking themselves is how well have prices recovered?

Some coins have been hit harder than others. In classic investor / trader fashion Polkadot’s much anticipated Parachain Auction launch was hit with a massive 23% fall as investors ‘sold the news’ on the day of launch. Less than 48 hours after hitting an all time high of $53.81 DOT slid to just above $41.50 on some exchanges. Prices have recovered since with DOT’s current price at around $45.

Even more worrying was OmiseGo’s (OMG) 35% fall from an all time high of $19.60 to a low of  $12.62 in little more than 15 hours. This spectacular fall from grace occurred immediately after a ‘wallet snapshot’ was conducted in order to grant OMG holders with free supplies of BOBA token. Although this kind of activity has been witnessed many times before (the XRP - Flare token air drop comes to mind) the speed and level of co-ordination in the OMG / BOBA situation is something to behold.

## The Call for Regulation

So where are we now? As I mentioned above, the overall cryptocurrency market cap only fell by 8% which in crypto terms is just a blip on the horizon. However, at time of press many tokens are continuing to fall in price and the overall market cap stands at $2.77 trillion, a drop of over $100 billion in the previous 24 hours.

While this is nothing to be afraid of, it does demonstrate how open to manipulation the cryptocurrency market is without laws to protect investors. Although the market has matured significantly in the last 12 months, if crypto truly desires promotion to the premier league of investment class it really needs to address this blatant market manipulation and the only way crypto can achieve this is through policy and regulation. Watch this space.

Crypto Market Blip – Why Is It Down Today?

Bitcoin miners in the mining industry are planning to move towards nuclear energy as pressure to go green increases.

According to Harry Sudok from [GRIID](https://grid-mining.com/?a=about), nuclear energy presents a 'tremendous opportunity to introduce enormous amounts of clean, carbon-free energy' to the base load. Sudok spoke at the Bitcoin and Beyond Virtual Summit earlier this month for American Bitcoin mining company, GRIID.

## Hopes for Nuclear Expansion

He said; “The growth rate is largely focused around solar and wind right now, and that’s just the reality of the programs that have been rolled out over the last 8-10 years. But what we’d love to see is an expansion of nuclear".

GRIID is a renewable energy company that specialises in solar and wind power. They have been mining since 2013 and offer full service to their customers who want to get involved with Bitcoin, but don't know how to start.

## Benefits of Using Renewables

Sudok believes the industry needs widespread adoption of renewables before it can be successful globally. He also wants more people to understand the benefits of using renewables. He said; “We need to communicate all the positive things that are happening in renewable energy, not just reduced emissions".

Sudok claims that GRIID has experienced an exponential growth rate for 12 months. They have expanded their customer base and staff numbers during this period.

Bitcoin Miners Look Towards More Sustainable Energy

Champagne corks were flying early Tuesday morning as another Bitcoin all time high was recorded.

According to average market data from Coinmarketcap.com, the price of Bitcoin topped out at $68,530 at 4:00am Tuesday morning (GMT), making November a month of serious gains for Bitcoin holders and investors so far.

Such a strong and continued surge in the recent price, resulting in the latest Bitcoin all time high, has renewed confidence in the $100,000 target before the end of the year. Indeed, many market pundits believe this magical milestone could even be achieved by the end of November.

**Halving**
-----------

The strong price action of Bitcoin is closely following historical trends that have been set post Bitcoin halving events in 2012 and 2016.

A Bitcoin halving occurs every 210,000 blocks (roughly every four years) when the block reward for mining Bitcoin is cut in half. As a consequence, demand for Bitcoin increases as supply is cut in half, leading to scarcity and a surge in price.

Previous Bitcoin halvings in November 2012 and July 2016 saw huge price rallies lasting up to 18 months before the price corrected and significant pull backs occur. However, many market experts are expecting the current price to continue to trend upward through Christmas and into 2022.

When the price will correct is up for debate, although the majority of market commentators believe $100,000 per Bitcoin is more than achievable this cycle.

**Stock to Flow Model**
-----------------------

This cause for optimism can be largely attributed to what is known as the ‘Stock to Flow’ model created in 2019 by the pseudonymous Plan B. The Stock to Flow, or S2F, model looks at the supply dynamics of Bitcoin in relation to previous halving cycles.

In particular, the model divides the remaining Bitcoin left to mine by the rate of annual production.

Price targets formulated by the model following the May 2020 halving have so far proven to be extremely accurate. The August 2021 target of the $47,000 was pretty much spot on as was the following September target of $43,000. Although last month’s target of $63,000 was out by just 3% many believe the November target of $98,000 is more than achievable. Interestingly, the model predicts that 2021 will end with a Bitcoin price close to $135,000.

You may be thinking this all seems too good to be true and you may be right.

Plan B anticipates the current rally will end sometime towards the end of Q1 2022 before the market experiences a significant price correction. While many people tend to agree with his analysis there are those who are taking into account the different socio-economic times we are living in now compared to 2016 and 2012.

As the world adjusts to a post-Covid reality, decentralised networks, the metaverse, NFTs and shared working spaces are becoming increasingly mainstream. This in turn could mean the price of Bitcoin and other leading digital assets remain high as more investors realise the serious potential that this new asset class brings to the investing table.

Bitcoin Records Latest All Time High

New York City’s mayor-elect Eric Adams took to Twitter last week saying that he would accept his first three wages in Bitcoin. The bond between Bitcoin and newly elected US officials is growing stronger, and that’s likely to hasten the pace at which new cryptocurrency regulatory measures are implemented.

The remarks were interpreted as an attempt to upstage Miami Mayor Francis Suarez, who said earlier that _he_ would accept 100% of _his_ salary in Bitcoin. Suarez told a major media outlet that the move would ‘send a message to the world that we are going to be one of the most innovative governments and innovative cities on the planet’.

Adams is apparently hoping to promote the same message in New York City.

## Will Crypto Contribute to the Economy?

The mayoral announcements are another win for cryptocurrencies, but they also serve as a reminder that Bitcoin, unlike any other asset class, still operates without any governing body overseeing them. Nor do they have a centralised, regulated exchange where people can go to trade them.

Whether either mayor has any success in dictating to their employers the currency in which they must be paid is yet to be seen, but for big media markets like Miami and Chicago to suggest that cryptocurrencies will be a core component of their city’s economic makeup only adds fuel to Bitcoin’s upward trajectory, and that means the current US administration is feeling more pressure to apply regulatory measures to an environment it’s only now beginning to understand.

## Crypto Regulation Steps In

Cryptocurrency regulatory oversight will likely be divvied up among several regulators, including the Securities and Exchange Commission (SEC) with the key players expected to be:

### U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler - The SEC’s primary role is to protect investors and ensure the markets function in an orderly fashion. Gensler, who has extensive regulatory experience, is expected to make the most meaningful contributions to writing the new cryptocurrency regulatory rulebook. What is perhaps most intriguing about Gensler is his previous role at the storied ‘MIT’, the Massachusetts Institute of Technology, where he taught a popular course called ‘Blockchain and Money’.

The most revealing of Gensler’s comments came at a recent conference where he compared cryptocurrencies, an asset class that’s been in existence for about 13 years, to a teenager, suggesting that the technology can’t be expected to reach ‘adulthood’ without regulatory oversight to usher the market to a state of maturity, and to stave off scams and criminal activities.

### Treasury Secretary Janet Yellen - Applauded for breaking so many glass ceilings, Janet Yellen is currently serving as the first female Secretary of the Treasury. As the incumbent of one of the most influential positions in American finance, it is within Yellen’s purview to lead the US Government in its oversight of the cryptocurrency market and its brokers. Prior to her role as secretary, Yellen spent several years as a member of the Federal Reserve Board of Governors where she peaked as the chair of the Federal Reserve.

In many forums, Yellen is often excoriated for showing little support for the cryptocurrency market. While Yellen certainly can’t be considered a cheerleader of the digital assets market, I do believe she is genuine in her concern for reeling in the misuse of existing digital currencies, and that’s is something that would further strengthen an already robust cryptocurrency market.

### Sen. Elizabeth Warren (Massachusetts) - Calling Senator Warren the _Cruella de Vil_ of the cryptocurrency universe may be a bit harsh, but the east coast progressive’s recent comments on digital assets most decidedly places her in the ‘sceptics’ column. Earlier this summer, Sen. Warren told [CNBC](https://www.cnbc.com/world/?region=world) that she’s doesn’t consider Bitcoin a reasonable hedge bet against inflation over the long run, and that’s one of the marquee reasons that some investors use as justification for purchasing Bitcoin, as a hedge against inflation.

## The Future for Crypto Wages

Looking ahead, Warren will be directly involved in formulating new regs on crypto in her role as a member of the Senate Banking Committee.

Cryptocurrencies are a technology that will revolutionize financial transactions at every level, and it will be incumbent on governments to come up with the appropriate cryptocurrency regulatory framework. The sooner reasonable regulations are applied, the sooner digital assets can evolve to their next level of usefulness.



Eric Adams: Wages in Bitcoin?

The decentralised nature of cryptocurrencies posed a major issue for big banks, but the evidence is that the old-style financial institutions are slowly entering the crypto-market

It was Halloween, 2008, when someone identifying themselves as _Satoshi Nakamoto_ released the Bitcoin white paper – an analysis of the viability of digital currencies in the world’s existing financial ecosystems.

The release of the report touched off a powder keg that exploded into a trillion-dollar market. The wild success of Bitcoin has given way to a constellation of new digital currencies with applications in virtually every market across the globe.

However, there is one founding principle of Bitcoin that has always rankled the brain trust of the traditional banking system. Cryptocurrencies would be a decentralised market, and through their application individuals would be able to transfer money _without_ a middleman or intermediary. This decentralisation posed a serious threat capable of eliminating the central, and very powerful, role that banks have traditionally played if Bitcoin ever became popular.

## Has it ever?

As the adoption of Bitcoin and other cryptocurrencies accelerated, regulator scrambled to come up with measures to control it, but these regulatory efforts served to _legitimise_ Bitcoin in the eyes of the public. The logic being that if the government wants to regulate it, then _it must_ be legit and that would do much to encourage the mainstream adoption of cryptocurrencies.

Up until recently, the biggest banks have made disparaging comments about Bitcoin hoping to discredit the digital assets in the minds of regulators, government officials, and pretty much anyone who was willing to listen.

Most notable of all, the CEO of JPMorgan. The leader of the nation’s largest bank has been leading the attempts to torpedo Bitcoin’s momentum by calling it “a terrible store of value” and warning of its potential role in financing criminal activity. Even back in 2018, Bank of America’s wealth managers were told they were being barred from putting any client money into investments considered cryptocurrency related.

## A Change of Heart for Bitcoin

Their attempts seem to have been in vain. Now, the world’s most powerful banks are realising their efforts would be more wisely invested trying to profit from crypto rather than continuing to lead ineffectual campaigns to slow its adoption. Still, this sudden change of heart will come at a price. While the bigger banks were busy slandering anything crypto, a new financial ecosystem evolved without them.

New cryptocurrency businesses and exchanges have begun to offer incentives one would expect to see only from a traditional banking system, like credit cards and loans. Investors and businesses are widely embracing the world of digital currencies, and mainstream adoption is proceeding at a frenetic pace.

## Changing Regulatory Approach

Now that the pendulum is swinging to pro-Bitcoin, the traditional banks have decided they want “in” on the profits. Major banks are making serious attempts at figuring how cryptocurrency can translate into new offerings and services for their clients. Banks have also changed their approach with regulators, lobbying them to create rules that work in _their_ favour and criticising them _for not moving quickly_ enough on cryptocurrency regulation issues.

Even JPMorgan, formerly the most vocal adversary of Bitcoin, [launched its own digital currency](https://www.jpmorgan.com/solutions/cib/news/digital-coin-payments) in 2019.

Now that there are more than 220 million global users of Bitcoin it is becoming more apparent that digitally formatted assets are here to stay. If traditional banks now believe in cryptocurrencies deeply enough to throw their support behind their ownership, the best days for cryptocurrency are yet to come.


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The Brave New World of Crypto ETFs

Crypto Market Blip – Why Is It Down Today?

Bitcoin Miners Look Towards More Sustainable Energy

Bitcoin Records Latest All Time High

Eric Adams: Wages in Bitcoin?

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