Since 2017, we have heard about the concept of tokenization - bringing real-world assets on-chain, simply put, wrapping information of real assets into tokens for easy exchange and trading, increasing the liquidity of that asset
[1]. The potential of tokenization has attracted the attention of giants in the traditional economy such as JPMorgan and BlackRock
[2], and has created the Real World Asset (RWA) trend in the crypto market
[3]. We used to think about tokenizing securities so that people can trade securities more easily.
However, contrary to expectations of tokenizing securities, we have just witnessed the securitizing token with the launch of the BTC spot ETF in January
[4]. The BTC spot ETF makes it easy for traditional investors to buy securities from ETF providers instead of directly buying and storing BTC themselves. The BTC spot ETF has brought tens of billions of USD from traditional investors into the crypto market and has boosted the BTC price, even though BTC purchases for ETF providers are still only taking place on the OTC market. BTC price increases, the crypto market grows, and crypto investors are happy to make a profit.
Larry Fink, CEO of BlackRock, once said: "ETFs are step one in the technological revolution in the financial markets. Step two is going to be the tokenization of every financial asset"
[5], but I think of another case: if in the future, most securities can be tokenized, then BTC spot ETF can also be tokenized, meaning that we will see a crazy value chain: value (energy) => tokenization (BTC) => securitization (BTC spot ETF: IBIT, FBTC, HODL...) => tokenization (BTC spot ETF token: IBIT token, FBTC token, HODL token...).
Of course, I am not talking about this cycle in a nonchalant way, the fact that tokens are becoming tokens again shows that something is wrong. While we are planning to "infect" the stock market with crypto by tokenizing securities, the largest traditional financial companies have successfully "infected" the crypto market with securities by BTC spot ETF. It is noteworthy that many investors in the crypto market are happy to consider BTC spot ETF as a maturity of BTC. Personally, I see BTC as a step for the stock market to penetrate the crypto market, making investors tend to buy BTC spot ETF instead of learning blockchain technology and self-custodying BTC. Maybe, BTC Spot ETF is just Wall Street's Trojan horse!
I would like to know your opinion on this issue:
- Do you support securitization or tokenization?
- BTC spot ETF is the maturity or degeneration of BTC?
- Does BTC spot ETF have any negative impact on BTC and the crypto market?
References:[1]
Tokenization: Real World Assets, Real World Benefits[2]
JPMorgan debuts tokenization platform, BlackRock among key clients: Report[3]
The Rise of Real World Asset Tokenization (RWA): Unlocking Asset Liquidity[4]
Spot Bitcoin ETFs Explained: Everything You Need to Know[5]
BlackRock’s Larry Fink says bitcoin ETFs are just the first step in the technological revolution of finance
Note:- My opinion has been presented in a topic, on BitcoinTalk forum.
- This topic on AltcoinsTalks forum has included a minor change in the way my opinion is presented.
- This statement is to avoid accusations of plagiarism.