I have said too much about the benefits of ETFs, and it is not an exaggeration to say that this historic moment is just a passing comment. Now, let me talk about another dimension that I have been thinking about recently: the negative challenges of ETFs and the four possibilities of "killing" Bitcoin:
1. Black boxing of the asset side: Last night at Space, I talked about the possible long-term negative impact of ETFs: when the market value of its holdings exceeds 30%, plus the 10% in CEX, the 10% lost and the "coinage" of derivatives, the black box holdings will exceed 50%, which will actually undermine the decentralization and liquidity of the Bitcoin asset side.
In fact, the market value of the existing Bitcoin spot + futures ETFs, including Grayscale, has reached about 33 billion US dollars, accounting for 3.5% of the circulation. I believe that in the next two cycles, it is possible to see the market value share reach more than 20%;
2. Nationalization of mining: Miners no longer enjoy a one-year payback period and an annualized return of more than 30% in four years, but will gradually shift to the average return rate of the mainstream currency market, less than 5%. The national team, various pension funds, and university foundations will become the mainstream of mining. Similarly, they will seriously threaten the decentralization of Bitcoin;
3. New Cold War Entity Sanctions: With the extreme mainstreaming of Bitcoin, Bitcoin will become a weapon in the game between China, the United States and other major powers. On the mining side and the asset side, entity list sanctions targeting specific wallet addresses will become more and more common. This will greatly challenge the core value of Bitcoin as a super-sovereign asset;
4. Extreme deflation leads to self-freezing: Bitcoin stability was originally used by Satoshi Nakamoto to counter the central bank's excessive money issuance, but when its consensus enters the mainstream world, people will learn a basic common sense that any Bitcoin spent today will be more valuable tomorrow. This will lead to an increasingly heavy hold sentiment until it is "frozen" to the extreme, and no one uses Bitcoin;
Solution:
What makes you successful may also destroy you. Satoshi Nakamoto's genius design is the real threat to Bitcoin. How to break the deadlock? Of course, you can ignore it. These things are likely to happen after the market value of Bitcoin exceeds that of gold (the price is more than 700,000 US dollars).
But in the end we have to face it. I believe that the decentralization of Bitcoin brings about super sovereignty and free competition in entities. It will produce natural game forces and ensure that asymmetry always exists in the Bitcoin world to counter the actual control of a certain country or a certain type of entity.
