The Trouble With Bitcoin ETFs

The new wave of U.S. bitcoin exchange-traded funds risks being doubly bad for investors.

As holders of bitcoin they undermine the very purpose, and so the long-term value, of a cryptocurrency. And as ETFs launched at a moment of popularity, they might be repeating the mistake of many past thematic funds by buying at a peak.

The pitch now being made is that bitcoin should be digital gold, holding its value in a crisis. So far there is zero evidence of that. And bitcoin ETFs are likely to make its bad performance in crises even worse, by bringing in even more speculators to what is already mostly a speculative asset.