Episode 91 of the Public Key podcast is here. The first Spot Bitcoin ETFs have been approved by the Securities Exchange Commission (SEC) in what is a watershed moment for crypto. We had the opportunity to speak to Jeff Billingham, who leads Strategic Initiatives at Chainalysis, who has been following these ETF submissions for almost a decade.
You can listen or subscribe now on Spotify, Apple, or Audible. Keep reading for a full preview of episode 91.
Public Key Episode 91: Decade long process of SEC approving first Spot Bitcoin ETF
Hooray !! Spot Bitcoin ETFs are finally approved by the Securities Exchange Commission (SEC) in what is being called a watershed moment for crypto. Now what happens?
In this episode, Ian Andrews (CMO, Chainalysis) sits down with Jeffrey Billingham (Strategic Initiatives, Chainalysis) who has been watching the Bitcoin ETF situation unfold since the Winklevoss twins first filed for a bitcoin (BTC) exchange-traded fund (ETF) in July 2013.
Jeff and Ian delve into the significance of these ETFs, explaining how they simplify access to bitcoin as an asset class and eliminate the technological hurdles of owning and transacting with cryptocurrency.
Jeff also explores the difference between spot and futures ETFs, the role of custodians and authorized participants, and the impact of surveillance-sharing agreements on market manipulation concerns.
They cover the immediate impact of these ETFs on the trading volume of Bitcoin and hypothesize on the future of ETFs and the potential for asset tokenization.
Quote of the episode
“That surveillance sharing agreement was essentially a way to tell the SEC, hey, we’re going above and beyond.. and we’re sort of working with the custodian and listing exchange to share, you know, information that does help either uncover market manipulation or, you know, hopefully prevent that kind of market manipulation and fraud from from occurring” – Jeffrey Billingham (Strategic Initiatives, Chainalysis)
Minute-by-minute episode breakdown
- (2:13) – Overview of the launch of Bitcoin ETFs and significant trade volume
- (4:43) – Explanation of what an ETF is and its significance of it being a Spot Bitcoin ETF
- (9:20) – Understanding ETF stakeholders like authorized participants, sponsors and custodians
- (11:40) – Impact of cash model for ETF transactions and hope for future in-kind transactions
- (15:24) – Regulatory concerns about market manipulation and fraud
- (18:23) – Surveillance-sharing agreements and increased transparency to secure SEC approvals
- (20:51) – Maturation of crypto as an asset class and its implications on original Bitcoin ethos
- (24:05) – Potential influence of ETFs on real-world asset tokenization
- (26:18) – Expectations for the future of ETFs
Related resources
Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.
Speakers on today’s episode
This website may contain links to third-party sites that are not under the control of Chainalysis, Inc. or its affiliates (collectively “Chainalysis”). Access to such information does not imply association with, endorsement of, approval of, or recommendation by Chainalysis of the site or its operators, and Chainalysis is not responsible for the products, services, or other content hosted therein.
Our podcasts are for informational purposes only, and are not intended to provide legal, tax, financial, or investment advice. Listeners should consult their own advisors before making these types of decisions. Chainalysis has no responsibility or liability for any decision made or any other acts or omissions in connection with your use of this material.
Chainalysis does not guarantee or warrant the accuracy, completeness, timeliness, suitability or validity of the information in any particular podcast and will not be responsible for any claim attributable to errors, omissions, or other inaccuracies of any part of such material.
Unless stated otherwise, reference to any specific product or entity does not constitute an endorsement or recommendation by Chainalysis. The views expressed by guests are their own and their appearance on the program does not imply an endorsement of them or any entity they represent. Views and opinions expressed by Chainalysis employees are those of the employees and do not necessarily reflect the views of the company.
Transcript
Ian:
Hey, everyone. Welcome to yet another episode of Public Key. This is your host, Ian Andrews. Today I’m joined by my colleague and friend Jeff Billingham. Jeff, welcome to the program.
Jeff:
Thank you so much, Ian. Great to be here.
Ian:
Well, I think all of crypto is excited to cover the topic that we’ve got today, which is the Bitcoin ETFs. Let’s start at the beginning. We saw these launch just a day prior to when we’re recording, which is on Friday, January 12th. What’s happened in the last day? I know there’s been a ton of movement, transaction volume in and out of these things. Maybe start with a quick summary there for us.
Jeff:
Yeah, sure. So I think this was a real watershed moment for the crypto industry, and in terms of the market response, I think we’ve seen over $4 1/2 billion worth of U.S. dollar trade volume go into all of the approved ETFs. So I think BlackRock’s ETF made up over a billion of that volume and that’s either the second highest or I think one of the highest debut volumes for a new ETF, so amazing work to see there. Grayscale was a conversion, so their previously live Bitcoin Trust, which converted into a spot ETF, so they saw volumes of something over $2 billion worth. So a considerable amount of first-day volume across, I think, all 11 ETFs that were approved.
Ian:
It’s something that I think people who follow the crypto industry closely have been anticipating for months, in some cases, years. I read the other day that the first application for one of these was submitted to the SEC way back in 2013, so a decade in the making. Maybe for people that aren’t following quite as closely, what is an ETF and why is this such a big deal?
Jeff:
Yeah, I have really fond memories, I will say, of the Winklevoss Trust ETF getting filed back in the middle of 2013. So it’s been a long, long road since then. But ETFs, exchange-traded funds, they’re derivative products that probably most people are familiar with through their retail brokerage. Instead of owning the underlying security or looking at the stock of a particular company, you can look at an ETF and look at it thematically and say, “What does this ETF cover?” The financial institutions that manage the construction and maintenance of the ETF are the ones who are responsible with actually owning the underlying securities. But you can select an ETF or any retail investor can select an ETF that covers broad themes like energy or healthcare or things like that. So a spot Bitcoin ETF is just a new way to own access to the price exposure of bitcoin without actually having to own the underlying bitcoin itself.
Ian:
Yeah, I think about very common in retirement portfolios in the United States, you see people buying the iShares, S&P ETF, which is effectively allows you to get a slice of every company that’s a component of the ETF. You don’t have to do all the legwork to go and buy the shares of those companies directly. You buy this index product, and it automatically rebalances as people come into or leave the S&P 500 index. It’s a really simple thing. Generally, it’s very low fee loads versus maybe directly trading those assets, so I think about it as a big simplification. But the point you just made in the world of crypto, the simplification is magnified here because in all the talk about the ETFs, no one once has said, “Okay, so this is how you get your crypto wallet, and then you need-
Jeff:
Right.
Ian:
… to fund your wallet this way, and then you need to send something to this address,” all of that goes away. So I think there’s some huge power here for the common individual that’s interested in bitcoin as an asset class but has maybe felt turned off by the technological hurdle to get into the space.
Jeff:
Yeah, I think there’s also just the ease with which you can see this up against all of your other investments, right?
Ian:
Mm-hmm.
Jeff:
For crypto nerds, I’ve been in this for a decade now, and I have no problem having my wallets and working with exchanges and also having my investments elsewhere. But for other people who want to invest in it as an asset class, to see it right alongside all of the other money market funds and ETFs and single stock equities or rates products that you own within your portfolio, I think that really changes the game as opposed to having this little island of crypto-owned assets at exchanges. So it’s a whole different perspective on investing in crypto.
Ian:
A number of people I’ve talked to have been excited about the opportunity to take funds that are in their retirement account. So you and I are both in the U.S., people have either a 401k at their company or maybe they’ve rolled that over into an IRA. Just to be able to very easily allocate some portion of those long-term holdings into Bitcoin without having to go through the machinations of withdrawing funds from the account or finding an IRA provider that allows you to somehow directly acquire digital assets, that whole complexity and headache just goes away in this model, right?
Jeff:
Totally. It totally goes away. Listen, I’m also a huge proponent of owning your own crypto. I think these things are not mutually exclusive, though. You can use these products as a way to diversify an overall portfolio, and also I would continue to encourage people to learn how to own and acquire crypto, but it’s a very easy thing to do for those who maybe didn’t have the crypto bug five, 10 years ago.
Ian:
Yeah, one step at a time.
Jeff:
One step at a time.
Ian:
Now maybe if we can drill into some of the technical details, again, for folks that don’t live and breathe this stuff like you and I do, so this is a spot ETF, which is different because we’ve actually had a futures ETF for a long time. Can you maybe explain the difference between futures and spot and why this spot ETF that’s just been made available is meaningfully different?
Jeff:
Yeah. Sure. So if you think about an ETF, it is the simplification, as you said, of owning exposure to a certain class of products or a certain pool of assets. The spot futures ETF, it’s an ETF that’s based on the futures contracts of Bitcoin. So there are futures markets in the U.S. for bitcoin and the spot futures ETFs are based off of those contracts. It’s not based off of the sole primary asset of bitcoin. So the spot bitcoin ETFs, the reason these are new is they’re not referencing the futures markets contracts. They’re referencing the primary asset of bitcoin itself in this case.
Ian:
Does that mean that when you buy a share in the ETF the price of the underlying asset is somehow different between the spot and the futures ETF products. Break this down for the average person. Does this really matter?
Jeff:
Well, this gets into the discussion about why the ETF for futures was approved versus the spot ETF not getting approved, because the reality is they’re referencing a market that is so closely correlated. But in terms of the construction of the spot Bitcoin ETF, the participants that are managing this ETF are actually purchasing bitcoin in this case. It has nothing to do with purchasing or holding futures contracts for bitcoin, it has everything to do with actually holding bitcoin as a primary asset. You’ll probably hear, and a lot of listeners maybe have heard people relate this to the gold ETF, right? This is akin to that. The way that gold ETFs were started in, I think, sometime in the mid-aughts, that’s all about having custodians actually hold gold for the benefit of ETF holders. So it’s the same thing in this case, the spot bitcoin ETF is referencing actual, quote, unquote, “physical bitcoin” that is held by custodians in this case, and nothing to do with the futures contracts.
Ian:
Physical digital bitcoin.
Jeff:
Correct. I never quite know, we talk about physical delivery in bitcoin, and we all know that that’s not really a thing. But holding bitcoin is really the change that we see that I think is really, really, really exciting about spot Bitcoin ETFs.
Ian:
Well, and I agree because this is a number of players that some of whom have been involved in the crypto ecosystem for some time, like Fidelity, I think they’ve been early amongst the traditional finance players being proponents of digital assets. But others like BlackRock who you mentioned earlier and seemed to be having huge success with the ETF, I would call a recent convert. They had not been attending all the Bitcoin Conferences for the last decade, but suddenly, they’re now a major player in the sector, and they’re actually having to acquire the asset directly. They’re now involved.
Jeff:
Yeah. So I will say that the team at BlackRock has been there for a very long time. They’ve been working on this for years and years and years, so I’ll give credit to where credit’s due. A lot of these institutions that maybe the headlines state that they’re being cautious, they’re anti-bitcoin, what have you, there have been teams that have been dedicated to this for probably close to a decade at this point.
Ian:
Wow.
Jeff:
So kudos to them for getting this across the line and doing all the evangelizing that we at Chainalysis do for the traditional financial markets. So I think it’s important to remember also that BlackRock is the sponsor in this case. For the vast majority of the ETFs involved, the actual custodian, the person who’s actually, or the company, the entity that’s actually holding the bitcoin for the benefit of the ultimate shareholders of the ETF is actually, in most cases for all the ETFs, it’s Coinbase is the crypto custodian; whereas, BlackRock is the sponsor and the manager of the ETF.
Ian:
Interesting. So explain what that custodian role does. When I buy a share of the BlackRock ETF, BlackRock then instructs the custodian to go out and actually purchase the underlying asset, in this case, bitcoins, and they then hold them for the benefit of BlackRock as long as I’m holding those shares. Is that what’s happening behind the scenes?
Jeff:
It’s like a balancing act. It’s a balancing act between the end investors like you and me or any other consumers who might go through Schwab or their retail brokerage account to purchase these. There always has to be a balance between how much bitcoin is actually held and the shares that are representing that ownership. So that fun role is actually played by what we call authorized participants in ETFs. So these are typically broker dealers who are able to go to the sponsor.
In this case, we’re talking about BlackRock, but any of these sponsors, VanEck, Grayscale, Fidelity, and these authorized participants will say, “Hey, I’m looking to either create more shares of the ETF or redeem shares of the ETF, based on how the market is moving.” If that imbalance is occurring, those authorized participants will choose to redeem or create new shares based on where the market is. So they are the ones who are in charge with keeping everything in balance. Whereas, BlackRock will then work with and instruct Coinbase to make sure that the Bitcoin that is owned for the benefit of the ETF is in check with the number of outstanding shares that those authorized participants manage in the market.
Ian:
Interesting. I’ve read in some of the press reports that Goldman Sachs and I think J.P. Morgan are two of the more notable players that have signed up to be these authorized participants. Is that the role that they’re playing?
Jeff:
Yeah. The ones that I’ve read about, I know Jane Street’s involved, Virtus is involved, the broker dealer at J.P. Is involved. I think one of the late stage of speed bumps for this with the SEC was actually a conversation about whether or not the ETS were going to be accepting in-kind transactions. So that’s to say that balancing act, as it was originally proposed, the balancing act would’ve been actually transacting with bitcoin, so receiving bitcoin for shares or shares for bitcoin. What ended up getting passed was a cash model instead.
So that cash model, just as a result of a lot of the ongoing concern and regulatory lack of clarity as to whether or not broker dealers can actually hold and trade bitcoin, the idea here is let Coinbase or the listed named crypto custodian manage the actual bitcoin holdings and have these authorized participants at BlackRock move cash that is representative of the value of that bitcoin. I’m hopeful that we get in-kind transactions, redemptions and creation models going forward, but what that did was actually open the door for banks to be authorized participants in this space as well. So I think the trade-off is you have more legitimate, well-regulated financial institutions who are able to become an authorized participant and a broker dealer for these markets.
Ian:
Interesting. I’m glad you explained that because I’ve been hearing this in-kind versus cash comparisons, and I didn’t totally understand the difference. So what I think you said is because of it being cash rather than in-kind, meaning in crypto, banks that would otherwise probably be restricted from holding and transacting in cryptocurrency directly suddenly are able to act as these authorized participants managing the market for the ETF transactional volume. Is that right?
Jeff:
Exactly. Exactly.
Ian:
Interesting.
Jeff:
So in-kind transactions always happen, for those other ETFs that we discussed that might be a basket of underlying securities-
Ian:
Right.
Jeff:
… all those broker dealers, they are registered and they’re able to legally actually transact with those securities and with cash between themselves. Whereas, in this case, the holding and custody of crypto for broker dealers is still a gray spot. So the cash prepay model that was instituted at the last minute, I would say around November, December, we saw all of the sponsors start to refile with a cash model instead of an in-kind model does allow for just more financial institutions to participate as authorized participants.
Ian:
What would be the process to add in-kind? How do these things evolve over time? Is that a whole new approval cycle? Is there an update model once they’ve been in market? It seems like things are largely working reasonably well. How has this unfolded historically with other ETF products?
Jeff:
Yeah, it’s a good question because I don’t know, or I can’t think of an ETF where it was a regulatory gray area as to whether or not broker dealers could actually hold it and transact with it. So there’s a lack of precedence when it comes to when we might see in-kind transactions happen for a spot bitcoin ETF or a spot crypto ETF. But I’m hopeful that the regulatory discussions around concerns about market manipulation and fraud and all that can be… we can work through those to get some clarity as to whether or not broker dealers can actually hold crypto right alongside any precious metal or any kind of security that they might hold on their books.
Ian:
Yeah. Talk a little bit about market manipulation, because this had been the long-held objection, I think, that was registered by the SEC in rejecting previous applications was the fact that there was maybe no central clearinghouse or just the fact that in certain venues, bitcoin was very lightly traded and therefore, more easily manipulatable than say, other things that underpinned similar ETF products. How did that get resolved in this case where we finally got the approval to happen?
Jeff:
Yeah. So this is where I think the work that Grayscale has been doing has been really consequential for the decision-making in all of the spot ETF applications that we’ve seen come to market just in the last couple of days because they had their trust, which they put in an application to convert that trust, which was denied by the SEC for all those reasons that you mentioned; fraud, market manipulation, concern around what’s actually happening in the crypto markets and inability to understand the dimensions of fraud that might plague this market. In the meantime, they had, over the course of the last several years, approved those futures ETFs.
So the SEC ultimately, through a bunch of court actions between the SEC and Grayscale, ultimately decided not to appeal a decision that was made by the D.C. Court of Appeals that the SEC was, quote, unquote, “arbitrary and capricious” in denying Grayscale’s application to convert their trust to an ETF, primarily because that court of appeals said, “Hey, SEC, your failure to explain why you disagree with Grayscale’s assertion that the spot ETFs of the spot markets and the futures markets are so closely correlated, why would you approve futures ETFs and deny a spot ETF?” Because they were not able to back that assertion up, the court of appeals sided with Grayscale in that case. I think it was towards the end of August or beginning of September of 2023 when it was clear that the SEC was not going to appeal that, that’s when I think a lot of the market that has been watching this for the last several years or several months felt really positive about the prospect of these ETF applications being approved.
Ian:
That all makes sense. I guess thinking a little bit more about this market surveillance thing, I think about rules in equities markets. If you’re a publicly-traded company, it’s very tightly controlled. Insiders aren’t allowed to make public statements except in very specific ways and during specific periods of the quarter, like an earnings call. In Bitcoin, there’s no company, but there are a lot of insiders. There’s people who have lots of accumulated information either through historical knowledge or relationships, and Bitcoin’s not traded on a single or even a small number of exchanges. It’s available widely, but there’s a number of market makers that I think have wired all those trading venues together that probably enjoy advantaged views, if I had to guess, and that’s just speculation on my part. But how then do you get to a similar level of confidence that there isn’t market manipulation and demonstrate that on an ongoing basis? I have to imagine that was a prerequisite for any of these applications getting approved, right?
Jeff:
Yeah. Well, so another novel bit to these applications that I think BlackRock actually really brought to this conversation was the idea of surveillance-sharing agreements, which is not a novel concept within the rest of finance, but they brought a surveillance sharing agreement to their ETF application, which is essentially a way to say, “Hey, there’s an agreement between the listing exchange,” in their case it was Nasdaq, “and the Bitcoin custodian,” the entity that’s responsible for making sure that the Bitcoin that is owned by the ETF is actually safe and secure.
That surveillance sharing agreement was essentially a way to tell the SEC, “Hey, we’re going above and beyond, and we’re working with the custodian of the listing exchange to share information that does help either uncover market manipulation or hopefully, prevent that kind of market manipulation and fraud from occurring.” Their ability to share information about Providence and other details that are private between those two parties was, I think, a great way… most of the other applications followed suit really quickly on creating a surveillance-sharing agreement inside of their applications as well. So I think that’s a really good sign and provided a lot of coverage above and beyond what the SEC was really concerned about in previous application rejections.
Ian:
Yeah, that’s terrific. It seems like it could have some really positive long-term implications for the overall market, and I guess it’s probably similar to how FINRA works in the equities world. They do perform a similar kind of information sharing between broker-dealers and exchanges, I think, if I’m understanding that concept.
Jeff:
Yeah, well, it all comes down to ultimately, it is KYC conversations, right? You have to make sure that in the case of FINRA, they’re licensing broker-dealers or an ETF setup where you’re relying on the KYC and anti-fraud, anti-market manipulation practices that a custodian manages, relying on that in order to make sure that the actual underlying of these ETFs is solid and safe and secure. So I think having that in writing and having those agreements detailed out with the SEC does go a long way to providing a best practice to get people much more clear on what the real risks are when you’re actually investing in a spot Bitcoin ETF.
Ian:
Yeah. I’m incredibly excited about it ’cause I think it’s the first really good piece of news that the crypto industry has had maybe in the last 18 months, and so I’m treating it as a harbinger of good things to come in 2024. But I do have to recognize the original crypto ethos was so much about defining your own destiny, not your keys, not your crypto, “I’m going to eliminate all the middlemen in the financial system. I’m going to directly hold all of my financial worth, and I’m going to interact with the individuals that I want to interact with directly without having to suffer the overhead of the existing financial system and the risks.” This seems like the absolute reverse of that ethos. We’ve taken bitcoin and turned it into a very classic financial instrument with layers of middlemen. As someone that’s been in the space for a long time and I think is very pro-crypto, generally, how do you feel about that?
Jeff:
I love the idea that this is harbinger of good things to come. I’m really excited for this year for the crypto markets. My personal ethos for the year is yes, and, so I take that and apply it here, which is to say I think that bitcoin and crypto, there are aspects and characteristics and possibilities that have absolutely nothing to do with looking at it as a financial tool or a financial instrument or an asset class. But nonetheless, there are characteristics of crypto that absolutely behave like something that at least for me, I would want in my portfolio. So I think this is very, very, very helpful.
This is a great opportunity to look at the use case, if you will, of crypto, of crypto as an asset class. This is the type of industry support and industry infrastructure that we need to build out that use case for a whole class of investors who have really probably heard about crypto and thought, “This is for tinfoil hat, crazy anarchists.” This is a very, very, very different conversation. So I think that maturation of crypto as an asset class, this is a huge, huge moment to be excited about. All of the other use cases of crypto aren’t mutually exclusive to that, right?
Ian:
Yeah.
Jeff:
Like the tokenization conversations, stablecoin conversations, everything that’s happening in DeFi, the world of art, the world of NFTs, all of that, I think, is still absolutely relevant and can grow right alongside infrastructure that supports crypto as a diversifying asset in a portfolio along with other boring TradFi assets.
Ian:
We obviously work with almost all of the crypto businesses out there. Do you think the existence of the ETFs actually pulls some of the transaction activity and direct business that had been happening at those centralized exchanges, or did the ETFs primarily draw in money that was not… they were invested elsewhere? Is this going to be newcomers to the space mostly? What do you think?
Jeff:
Yeah, I am probably not the one to try to read the tea leaves here, but I think there’s going to be a huge push for more and better enterprise-ready financial institution-ready infrastructure that does support the transactions of managing bitcoin on behalf of all these ETFs. There’s still going to be a lot of movement there based on the U.S. dollar inflows to all these ETFs. So there’s still a lot of, I’d expect, transaction activity, but I don’t think this is necessarily taking anything away from anybody who wants to open a Coinbase account. It’s really two very different things. As somebody who just bought some of the spot bitcoin ETF yesterday and as somebody who has crypto on exchanges, those two experiences and I guess those two activities represent something very, very different to me that I want to participate in both. So I can only hope that these spot ETFs bring in maybe new investors who haven’t taken the time to download a wallet or open an account at an exchange. Maybe they will follow suit with doing that after having invested in some of these ETFs.
Ian:
Yeah, that’s my bet, and I have no inside information either, so it’s pure speculation. But just watching the news coverage this week, it seems likely that you’re going to draw in a lot of new people who find the path to involvement so much simplified that it’s like, “Great, this is terrific. It’s exactly what I wanted to do.” May not totally understand even what Bitcoin is at the point of inception, but it draws them into the space and then grows from there.
Jeff:
Right. Right.
Ian:
I’m curious about a related topic. I’ve been hearing nonstop this drumbeat around real-world asset tokenization. I’m curious, does the ETF accelerate that? What effect do you think it’ll have on some of these asset tokenization projects we’ve been hearing about?
Jeff:
That’s a good question. I think to the extent that it provides investors, again, who have maybe looked at all of the different use cases in crypto with a degree of cynicism or maybe a degree of fatigue because we’ve been talking about tokenization for a very long time, even people within crypto have said, “Oh, when is this taking off?” I know that there is a lot of anxiety around the inertia of the tokenization conversation happening, but I think ETFs will again provide that level of professionalization and maturation of crypto in general that might allow investors to take another look at or take another consideration of what are the tenants of tokenization for other financial products?
It also opens the door to maybe consider if you want to take a really broad or a long-term view, how might other ETFs be constructed that are not just solely about bitcoin or solely about Ether. What kind of underlying basket of tokens, be they stablecoins or anything else, what might that actually entail? So hopefully there’ll be maybe a renewed interest and optimism for the thought experiments that would go into looking at or considering ETFs that might represent crypto assets that are not just simply the most classic ones that we on the market know about.
Ian:
Yeah. Yeah, it’s going to be fun to watch. Well, Jeff, this has been fantastic. Just to wrap up, walk us through what happens next. So as we’re recording this, we got 11 approvals yesterday or two days ago, and then yesterday they actually started trading massive inflows. What can we expect next week and beyond?
Jeff:
Yeah, I think immediately there is going to be, I think, a big push on fees. You have a number of ETFs that are out there that are offering more or less the same thing, so I’m excited to see how these different sponsors diversify their offering by either way of minimizing their costs or getting innovative with their sales and distribution channels on this. I think you’ll definitely see a little bit more of that variation like we were talking about with tokenization. Grayscale just filed another application for a covered call Bitcoin ETF. They did that yesterday, which is really interesting. That would put a new flavor of options contracts into the investment goals of that particular ETF. I think Ark and BlackRock have both filed Ether spot ETFs as well. So we’ll see, I think, a lot more variation, and I’m excited to see what the decisions are on those.
In the long run, I think we’ll see a real big push for better infrastructure and better data too. You’ve got a lot more people who need to be confident that they can move and transfer Bitcoin and know where it’s coming from and know where it’s going to and be certain that they’re not associated with any kind of illicit activity, and people will look for better data. People will want to understand the markets more and more and more as they allocate a small percentage of their overall net worth into this asset class. So who’s using it? What region of the world is using it? Why? What are the use cases? Where is it growing? Those are all questions that data providers like us, I’m not [inaudible 00:35:35] too much for Chainalysis here, but those are the kinds of themes that I think there’s going to be a lot of focus on how do you answer those questions with data for investors and potential investors.
Ian:
That’s right. All those questions, that’s exactly what we do here at Chainalysis.
Jeff:
That’s right.
Ian:
If you’re out there listening and you need a little bit of help, you know how to find us. Jeff, this has been fantastic.
Jeff:
For sure.
Ian:
Thanks so much for joining us fresh off vacation and diving into this topic, and we’ll have to have you back on the show soon.
Jeff:
Awesome. Thanks so much, Ian.
