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Fed Watch - Bitcoin and Macro


Mar 10, 2021

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iTunes: https://podcasts.apple.com/us/podcast/fed-watch-bitcoin-and-macro/id1543640492

Youtube: https://www.youtube.com/channel/UCtOV5M-T3GcsJAq8QKaf0lg

Bitcoin Magazine: https://bitcoinmagazine.com

In this episode of Bitcoin Magazine’s Fed Watch podcast, Christian Keroles and Ansel Lindner speak with Elliot Johnson of Evolve ETFs. Elliot and Evolve launched a bitcoin ETF in Canada in February and we discuss all about that experience. Evolve has many ETF products centered around disruptive technologies. Elliot has a lot of experience launching products like these and working with regulators on financial products, so we took the opportunity to dive deeply into the area of his expertise and get his view on bitcoin and the macroeconomic climate in general. As you can tell, it ended up being a pretty broad conversation.

It is nice to interview industry professionals who are, perhaps we can say, tangential to bitcoin. While Evolve is not technically a bitcoin only company, they have several ETF products in the space. Elliot related how their bitcoin ETF was the first product they tried to launch back in 2017, but the regulators weren’t ready for it back then. They kept trying and now have become one of the three bitcoin ETFs that were launched in Canada in the last month.

Elliot says, though the process took several years, Canada is emerging as a forward thinking financial jurisdiction. They are very comfortable with disruptive new products, and he hopes to maintain the good working relationship with the Ontario Securities Commision in the future. 

Next we bring it back to the US and dive deeply into his view on Grayscale’s Bitcoin Trust (GBTC) and their current discount. He chalks it up to the opening up of competition in the space. This is a convincing argument, because the month prior to Canada’s three major bitcoin ETFs launching, the premium on GBTC was 40%. Today, it sits at -10%. Elliot also, obviously, leans toward the ETF structure as being superior to the Trust based structure of GBTC. Open-ended ETFs will remain closer to Net Asset Value (NAV) of the underlying than a close-ended Trust can. 

We get into Elliot’s macro vision of what’s going on right now and where bitcoin fits. He is quite keen on bitcoin as digital gold, fulfilling a large need for an alternate storage asset. When asked about where he sees the industry going in the next 5 to 1- years Elliot focuses on the growing respect of the asset class. He also made an interesting point, that in his daily interactions with interested investors of this bitcoin ETF, they tend to be those who do not own bitcoin in any other capacity already. It is not current holders looking to diversify, but it is all new investor demand.

Lastly, we ask for his advice to new investors and his opinion on a healthy bitcoin allocation in a portfolio. Of course, he was very professional and suggested talking to your financial advisor, and he ended on the need for continued work on education in the space. 

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Links 

Evolve ETFs https://evolveetfs.com/

Written by Ansel Lindner

Economist, author and bitcoin specialist. Find more from Ansel at the Bitcoin & Markets podcast (bitcoinandmarkets.com), the BitcoinDictionary.cc, and macro blog Bitcoin & Markets Research (BTCM.co).