Wallet Hacks & The BTC ETF

Any crypto holder will tell you ‘not your keys not your crypto’ regarding staking on an exchange. There is a storied history showing why this is a bad idea Mt Gox. FTX etc.

Storing crypto on a wallet is considered the gold standard. ‘Be your own bank’.

However the barrier to mass adoption thus far is that deep down the average person doesn’t really want to be their own bank.

That is because people make mistakes. People store their seed phrase online, people OK malicious contracts etc. Ledgers software gets hacked like happened today. People want to be covered in the event that their money is stolen. The average retail investors need the security and insurance a bank account provides. That’s why people store crypto on exchanges, because they mistakenly believe that, because they look like banks, they offer the same level of cover in the event of disaster. Which they don’t. Exchanges fail, people get scared of crypto and mass adoption does not happen.

That is until the BTC ETF is approved.

The narrative so far has been that the ETF will allow huge inflows of capital from institutions. However, although this is likely true I believe the real step change will be the security that holding BTC via an ETF will provide for retail users which will usher in the final stage of mass adoption.

Why would an average, non tech savvy retail user want to hold BTC on a physical cold wallet with their seed phrase stamped into a stainless steel plate when Black Rock can provide the same level or greater security holding it via an BTC ETF with very little effort? No more lost seed phrases. No more hacked exchanges without insurance to cover a retailers losses. In the extremely unlikely event that Black Rock gets hacked then their insurance pays out.

Mass confidence in the security of holding BTC via ETF results in mass adoption from institutions and, less reportedly, retail.

Number go up. More than originally expected.