Seeking Driver for Digital Economy: Can ETN Replace ETF?

“When should we wait for the bitcoin ETF” is one of the main questions in the cryptoindustry. It’s sometimes that it’s getting absurd. When everyone was claiming that wake for the crypto is to be held next weekend, just a single “ cautious positive opinion”  is more than enough to decisive surge on the market

But there was no real news on the market. It’s not likely that we are going to hear anything worthwhile before the late September or even the first part of 2019. Cryptoverse is going to see any clarity only when SEC will rule out anything related with ETF applications. And anything else than that is nothing but a market manipulation и and hype trading

This is one of the reasons why closest ETF cousin, ETN, came into play in the USA.  First of all - let’s see what the ETN is? That's an Exchange Traded Note, the so-called “ soft alternative”  to ETF, which was advertised as a market mover. However, in their nature - they are very different, despite certain similarities in their life.

An ETF is marketable security that tracks either an index of funds, a commodity or a basket of assets, or in our case - cryptocurrency, that helps to get rid of the particular problems related with actual ownership of the crypto. That's a dream of the institutional investors since they already have a vast experience with it and understand it, unlike crypto itself. Plus ETF is backed by a real product, or in this case - crypto assets.

At the same time - ETN, despite their common traits, it is a different thing.  If ETF is backed by crypto (bitcoin in this case), ETN is backed by the debt of a place that issued it. So if use simpler terms - ETF is pretty much the same as a share of an asset, while ETN is a note.

Which one is simpler and better is a hard question. First one is more straightforward and more obvious.  And the second one is more profitable. And in the same time - much riskier, especially if you keep in mind that fact that we are talking about cryptoverse here. That's one of the reasons why no one “bought” the idea that this is a market mover that can change the way how everything works and  reaction to the news looked like a strong “Meh.” No one cared all that much. We talked about this with Scott GETTLEMAN, experienced trader straight from New-York.

“ETF is much more interesting as far as I'm concerned.  First, off all -it comes with regulatory approval. Investors can purchase a Bitcoin ETN right now but haven't.  Retail investors are more familiar and have a greater comfort level with ETF's, which are probably in their portfolio already.   Institutions haven't stepped up to buy the Bitcoin ETN; they will use the Bitcoin ETF. The larger institutional investor needs security and liquidity, which ETFs don't always provide.”

According to the trends - the market should’ve had a significant bump because of that. But retail investors aren’t that interested in it. In fact - “fat cats from Wall-Street” haven’t even budged and made it very clear that cryptoverse won’t see their money before that moment when SEC will say that it’s all clear.

No one can tell for sure if future of the crypto is bright or not, the situation can change with the blazing speed of thousand suns where any prediction and become accurate and false within the same week. But one thing is clear - there are people with coffers full of gold, real one, that can send crypto industry to “the moon,” where legendary 20k per coin is not a limit.