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0 sats \ 11 replies \ @gd 5 Mar 2024 \ parent \ on: Will MSTR Outperform or Underperform Against Bitcoin? bitcoin
The value of the currency that the ETFs are denominated in (and pay out in) will be worthless
let’s assume the US dollar goes to zero and is no longer a currency one day.
do you believe the ETF holders will see all their Bitcoin ETF shares disappear?
i don’t.
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Not at all, but they won't be able to redeem anything of value with the ETF shares.
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why not?
if you can’t “redeem anything of value”, you’re essentially saying the ETFs will go to zero.
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Because they're a claim on dollars, not Bitcoin— you said "let's assume the US dollar goes to zero"
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Because they're a claim on dollars
Are they really though? I think ETF holders will be compensated in the event of a US dollar collapse.
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They’ll be compensated in large sums of dollars. ETFs are contracts which have iron clad terms.
There would be no obligation to suddenly compensate people with something infinitely more valuable than they are contractually obliged to. Especially when the advice has always been “your investment can go to zero, don’t invest anything you’re not willing to lose”.
The recommended reading link I posted in my original comment is a concrete example of that from history.