There is so much hype around a crypto-linked exchange-traded fund (ETF) in the crypto world right now. While some say an ETF will open so many doors for the crypto world and might help boost the market overall with large institutional investment coming in, others are of the view that it might not be as helpful as initiatives like Bakkt.
BlockPublisher recently got in touch with David Johnston, Managing Director of Yeoman Growth Capital, a growth capital fund focused on the blockchain technology. In reply to the questions regarding when will we see a crypto-linked ETF and what effect it might have on the market, David said:
ETFs are useful tools to connect legacy financial systems to crypto, however they are NOT a fundamental factor related to usage or the utility of a crypto currency and so I tend to discount their importance. I believe the whole ETF date guessing is missing the point. What matters is adoption and real world usage.
As implied by David, it is the real world usage and adoption of cryptocurrencies that will likely help the crypto market grow overall. Platforms like Bakkt are more likely to help the adoption of cryptocurrencies than an ETF. In order for cryptos to expand more and more, the need of the hour is to expand its adoption.
Right now, cryptos are mostly used by people to get profits in fiat. Since the market is very volatile, it becomes only natural to not use cryptocurrencies as a source of making payments. If the crypto world is to grow and mature, payment opportunities should be provided to the users in the real world so that they can use cryptos to carry out their daily activities.
Trust regarding cryptocurrencies among the public is also on the relatively lower side. The crypto market is rife with issues like volatility, manipulation, custody, liquidity, etc. The connotation attached with cryptocurrencies in the media is also mainly negative. Illegal activities and scams have taken a hold of this space and as a result, the general public does not want to get involved in it.
If this space is to gain mainstream adoption, developments need to be made regarding the usage of cryptocurrencies on the ground in the real world. An ETF might help the crypto market get a boost but then again, without user-adoption, that will likely be only short-term. All in all, things are getting more and more exciting in the crypto world. One can only speculate about the impact that a certain development might make. Let’s see what outcomes arise as we see a crypto ETF getting established.
SEE ALSO: Feb Won’t See a Bitcoin (BTC) ETF, According to Anthony Parker
