Former official of the U.S. Securities and Exchange Commission (SEC), John Reed Stark, expressed negative views on Bitcoin spot ETF, stating that cryptocurrencies have no intrinsic value and are only used for criminal activities. Bitcoin spot ETF would bring fraud and market manipulation risks to ordinary investors and should not be approved.
Cryptocurrency ETF Should Not Be Approved
Cryptocurrencies Have No Intrinsic Value
Cryptocurrencies Have No Positive Use
Issues Brought by Bitcoin Spot ETF
Another Fee Structure
Another Ponzi Scheme
Another Predatory Inclusion
Another Concealed Intention Vocabulary
Current Bitcoin Rebound is False
Related Companies Have Not Been Liquidated
Tether’s Coin Minting
Market Manipulation by Whales
State of Anarchy
Please Tell Me Bitcoin ETF Isn’t Real
John believes that cryptocurrencies have no intrinsic value, no cash flow, no income, no employees, no management, no balance sheet, no product, no service, no operational record, and no analytical valuation. Apart from speculative analysis related to cryptocurrencies, there is no other data to refer to.
The reasons for the rise in cryptocurrency prices are twofold:
Because there is no regulatory body to prevent market manipulation.
Because people can sell cryptocurrencies to less savvy investors.
Therefore, cryptocurrencies have been severely overvalued until there are no more greater fools to buy, and everything will collapse.
Cryptocurrencies only have one practical proven use – crime, such as terrorism, money laundering, sanctions evasion, ransomware attacks, drug trafficking, child pornography, human trafficking, and espionage.
And now, SEC is actually considering approving a Bitcoin spot ETF?
If a Bitcoin spot ETF is approved by the SEC, it would be a disaster for the market because it would bring:
Currently, the institutions applying for Bitcoin spot ETF on the market are just a group of opportunistic financial giants who shamelessly design and manufacture products to let more investors experience bankruptcy and incalculable risks, while they themselves profit.
(11 companies including VanEck resubmit SEC documents, if approved, will give ETF profits back to the Bitcoin community Brink)
Although the initiators of Bitcoin spot ETF advocate that cryptocurrencies can bring the unbanked population into the financial ecosystem, the reality is quite the opposite. Cryptocurrencies are not only more expensive and complex than mainstream finance, but also a huge Ponzi scheme.
Cryptocurrencies are just another example of predatory inclusion and affinity fraud.
Cryptocurrencies have many similarities with other predatory products. They are sold to deceive vulnerable and disgruntled people, offering more unequal financial services to historically marginalized groups by mainstream society. At first glance, cryptocurrencies seem to offer opportunities to the vulnerable under the guise of inclusivity, but in reality, they only worsen their situation. Cryptocurrencies cannot solve the historical problems of inclusive finance.
On the other hand, the current functions of cryptocurrencies do not correspond to the needs of their target audience. Instead, they bring many risks and disadvantages, thereby weakening the benefits of cryptocurrencies.
Bitcoin spot ETF is a ridiculous concept because it is just another Wall Street investment scam and a huge money-grabbing plan, and may even be the most centralized crypto asset. Wasn’t Bitcoin created to pursue decentralization?
The proponents of Bitcoin spot ETF cite the recent rise in Bitcoin prices as evidence that Bitcoin is an important investment and that ordinary investors should be able to easily obtain Bitcoin.
But John believes that this is a carefully planned trick, and he identified four real reasons for the recent rise in Bitcoin:
In recent years, numerous major cryptocurrency bankruptcies, including FTX and Three Arrows Capital, have led to a significant reduction in Bitcoin supply, causing a supply-demand imbalance and resulting in the increase in Bitcoin value.
However, these supply-demand imbalances are temporary. These locked Bitcoins will be liquidated and dumped into the market at some point in the future, which will lower the value of Bitcoin.
Tether arbitrarily minted 5 billion USDT as air loans in the past month—backed only by the loan itself or cryptocurrencies as reserve assets—issuing “fake dollars” out of thin air to some large clients, without actual dollars entering the system.
Cryptocurrency institutions, including exchanges and hedge funds, can use this method to increase leverage and push up the price of cryptocurrencies, then use the inflated cryptocurrencies as collateral to borrow more USDT and continue this operation.
Approximately 10,000 people own 30% of Bitcoin, and 100,000 people own 50% of Bitcoin. It can be seen that the cryptocurrency market is a market with very low liquidity. Relevant personnel do not disclose transactions, and there is no transaction transparency, regulatory checks, or audits. Market manipulation is prevalent and not surprising.
Whales can manipulate prices through large buy and sell orders. Such behavior triggers a domino effect on the entire market, affecting traders’ and investors’ emotions and reactions. Therefore, whales create the desired market reaction by driving token prices and supply and greatly influence the liquidity and price stability of cryptocurrencies. There are countless methods of controlling the Bitcoin market.
(BlockBeats interview with controversial market maker DWF Labs: We do not manipulate the market)
For traditional financial companies registered with the SEC, the SEC has absolute and immediate control over all aspects of their operations. However, the SEC lacks this supervision and access in the Bitcoin market, lacks the ability to detect, investigate, and prevent fraudulent activities, and as a result, the Bitcoin market operates in a regulatory vacuum, making it impossible for the SEC to discover misconduct and enforce violations.
The Bitcoin market is full of fraud and manipulation, which means that approving these products will expose millions of American investors and retirees to the harm that the SEC aims to prevent.
On the other hand, approving Bitcoin spot ETF will lead to the repackaging of the future cryptocurrency industry. Industry players can claim or imply that their products have now received approval from the U.S. government and will undoubtedly market them heavily to Americans, implying that the SEC’s action has legalized cryptocurrencies and giving retail investors a false sense of security.
SEC approval is a mistake. The investment risks of Bitcoin have been evident and repeatedly appeared in the past three years, resulting in billions of dollars in losses. Investors in Bitcoin spot will face the same market fraud and manipulation risks as direct Bitcoin holders. The SEC should not expose investors to these risks.
Chairman Gensler, who has been committed to protecting investors, maintaining fair, orderly, and efficient markets, and promoting capital operation since taking office, now seems to have found his destiny and may end his power with a dramatic and tumultuous turn.
Gary, please tell me this isn’t real…
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