Benzinga - Economist and staunch Bitcoin (CRYPTO: BTC) critic Peter Schiff traded his guns on spot ETFs associated with the digital asset yet again.
What Happened: On Tuesday, Schiff took to X, formerly Twitter, to question the impact of the investment avenues that went up for trading early this year on the price movement of Bitcoin.
"Despite buying from 11 spot Bitcoin ETFs, Bitcoin has traded sideways for over three months. The current price is 11% below the March high," he pointed out.
Despite buying from 11 spot #Bitcoin ETFs, Bitcoin has traded sideways for over three months. The current price is 11% below the March high. If ETF investors have been buying, whose been selling and why? What happens when ETF buyers get tired of waiting and become sellers too?— Peter Schiff (@PeterSchiff) June 17, 2024
Schiff wondered if ETF investors are purchasing, what is causing sell pressure on Bitcoin. He rhetorically threw a question to the advocates of Bitcoin, "What happens when ETF buyers get tired of waiting and become sellers too?"
Well-known cryptocurrency analyst James Van Straten countered Schiff's arguments by linking the ongoing downturn in Bitcoin market with basis trading–a market-neutral strategy that uses the difference between the spot price and the futures contract price of an asset.
He further explained that Bitcoin's average realized price was in the $50,000 zone, higher than what it was during ETF launch. "ETF buyers are in healthy profit," Van Straten asserted.
Why It Matters: Schiff's comments come just a week after he warned that reliance on institutional ETF buying to drive up Bitcoin prices could lead to market instability.
Prior to this, he used the excitement around Ethereum (CRYPTO: ETH) spot ETF approvals to question the future of Bitcoin, suggesting that any funds used to buy new Ether ETFs would likely come from existing Bitcoin ETFs.
Price Action: At the time of writing, Bitcoin was exchanging hands at $65,335.68, down 1.46% in the last 24 hours, according to data from Benzinga Pro.
Photo courtesy: Gage Skidmore on Flickr
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