The Bull Case for Crypto ETFs | Matt Hougan & Hunter Horsley
In today's episode of Empire Jason and Santi are joined by Bitwise CEO Hunter Horsley and CIO Matt Hougan to dive into the world of ETFs. They discuss the early skepticism and misconceptions around ETFs, why a Bitcoin ETF approval could be transformative for crypto adoption and maturity, the layers of security and regulation with ETFs, and the potential timeline and sequence for crypto ETF products. They close out by exploring how an ETF could boost crypto's credibility and accessibility for traditional investors and revisiting the bull case for Coinbase.
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Timestamps:
(00:00) False ETF News
(02:30) What is an ETF?
(09:03) Market Manipulation in Crypto
(14:52) Investment Reality in Crypto
(21:47) Who Wins if ETFs are Approved?
(29:52) Regulatory Concerns for ETFs
(35:15) Toku Ad
(36:30) Voting and Delegate Structure of ETFs
(40:26) Safety and Reporting of Crypto ETFs
(46:43) Timeline and Sequence of ETF Types for Crypto
(53:52) Can Crypto Change ETFs?
(56:35) Coinbase Thesis
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Resources
Bitwise ETFs
https://blockworks.co/news/0xresearch-bitwise-spot-bitcoin-etf
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Disclaimer: Nothing said on Empire is a recommendation to buy or sell securities or tokens. This podcast is for informational purposes only, and any views expressed by anyone on the show are solely our opinions, not financial advice. Santiago, Jason, and our guests may hold positions in the companies, funds, or projects discussed.
Bitwise CEO explains how bitcoin’s “magical” volatility will woo Wall Street firms
Bitwise, the $1 billion-plus crypto asset management firm, announced a Series B funding round to further advance its index and fund products on Wall Street.
With the raise, Bitwise became the latest startup in the digital asset industry to raise fresh capital amid a period of heightened interest from institutions and their clients.
In this episode of The Scoop, Bitwise co-founder and CEO Hunter Horsley explained how the industry is creating access for new classes of investors. In Horsley’s view, traditional portfolio managers and financial advisors remain an untapped market for the nascent crypto asset management industry.
In terms of the volatility, Hunter sees this as a positive. For Bitwise, volatility means the opportunity for financial advisors to enter the cryptocurrency market by adopting crypto as another asset class in a client or portfolio’s diversification strategy.
“The volatility of crypto is a magical gift for a financial advisor. What do I mean by that? If you're an individual who downloads one of the incredible apps that you have today, you see this jagged price chart, this twenty-four-hour price chart. Right. It's very scary, prone to emotional trading. And that's the scary version of volatility. If you're a financial advisor constructing a portfolio that you want to have certain low correlations, you want to have a certain Sharpe ratio, you want to balance across different asset classes. Well, in that case, crypto volatility is actually very useful.”
Looking back to Bitwise's latest round, the startup managed to attract notable backers. Indeed, some of the investors involved in raising the Series B round were industry heavy-hitters.As Horsley put it:
“[The Series B Funding was] collected by Elad Gil, one of the most accomplished technology investors, Electric Capital, one of the leading crypto venture capital firms and some renowned Wall Street investors; Dan Loeb's Third Point, Daniel Ochs Willoughby, Louis Bacon’s Moore Strategic Ventures, Henry Kravis, Stanley Druckenmiller and [Bridgewater CEO] Dave McCormick.”
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Bitwise's Latest Plans to Get a Bitcoin ETF Approved - Ep.143
Hunter Horsley, cofounder and CEO of Bitwise Asset Management, and Matt Hougan, global head of research at Bitwise, describe their vision for Bitwise, its current funds and indices, as well as how it handles things like forks and airdrops. Then they give their reaction to and interpretation of the SEC disapproval of their Bitcoin ETF proposal, as well as what their focus will be now to try to get a Bitcoin ETF approved. We also discuss their general thesis around how the crypto space will develop, whether or not indices and funds around the top 100 assets will ever make sense, their ideas on how to value these networks and whether or not the company would ever try to compete in the DeFi space. Plus, don't miss our conversation on Bitcoin IRAs.
Thank you to our sponsors!
Crypto.com: http://crypto.com/
Kraken: https://kraken.com
CipherTrace: https://ciphertrace.com/unchained
Episode links:
Bitwise: https://www.bitwiseinvestments.com/
Hunter Horsley: https://twitter.com/HHorsley
Matt Hougan: https://twitter.com/Matt_Hougan
Unchained interview with Spencer Bogart: https://unchainedpodcast.com/spencer-bogart-on-the-20-trillion-in-store-of-value-assets/
Bitwise 10 Private Fund fact sheet: https://static.bitwiseinvestments.com/FactSheet/bitwise10/Bitwise-10-Private-Index-Fund-Investor-Class-Fact-Sheet.pdf
Bitwise 10 Offshore Index Fund: https://static.bitwiseinvestments.com/FactSheet/bitwise10-offshore/Bitwise-10-Index-Offshore-Fund-Investor-Fact-Sheet.pdf
Grayscale Bitcoin Investment Trust: https://grayscale.co/bitcoin-trust/
Bitwise Ethereum Fund: https://static.bitwiseinvestments.com/FactSheet/ethereumFund/Bitwise-Ethereum-Fund-Investor-Class-Fact-Sheet.pdf
SEC order disapproving the Bitwise Bitcoin ETF proposal: https://www.sec.gov/rules/sro/nysearca/2019/34-87267.pdf
Matt on CNBC discussing the Bitcoin ETF proposal: https://twitter.com/CNBC/status/1181309471349526530?s=20
Bitstamp/BitMEX trading manipulation: https://twitter.com/DoveyWan/status/1129246233917382656
Jake Chervinsky’s tweet about how the SEC is unlikely to approve a Bitcoin ETF under Chair Jay Clayton: https://twitter.com/jchervinsky/status/1182149164177608704?s=20
Unchained interview with Jake: https://unchainedpodcast.com/all-things-crypto-regulation-with-jake-chervinsky/
SEC commissioner Hester Peirce’s dissent to the disapproval of the Winklevoss Bitcoin ETF: https://www.sec.gov/news/public-statement/peirce-dissent-34-83723
Van Eck’s withdrawal of the Bitcoin ETF proposal: https://www.coindesk.com/vaneck-solidx-withdraw-bitcoin-etf-proposal-from-sec-review
Chris Burniske on how to value these networks: https://unchainedpodcast.com/how-to-value-a-crypto-asset/
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