SOME OF THE IMPACTS OF THE BITCOIN EXCHANGE TRADED FUNDs ON THE CRYPTO SPACE.

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Good day to you all once again active and supporting members of this community, I'm happy to be here making this post here in this community today I will be writing about the bitcoin exchange traded funds, I will be discussing and explaining some of the significant and major effects and impact the introduction of this bitcoin exchange traded funds will have on the cryptocurrency market space and its ecosystem as a whole.

However, before I start to discuss and explain these major and significant impact and effect I would like write and discuss briefly on bitcoin and on exchange traded funds please do well to give me and this post your undivided attention, bitcoin is basically the first cryptocurrency to successfully created and it is the market mover for all other cryptocurrency and that is why the bitcoin exchange traded funds have become a hot topic within the cryptocurrency and financial sectors, seeing as institutions and retail investors are looking for simpler ways to access Bitcoin as an asset.

Therefore that is the first thing the bitcoin exchange traded funds is, a simpler way for accessing bitcoins as an asset, the exchange traded funds can then also be said to be investment funds that track the performance of a particular asset or group of assets and are traded on traditional stock exchanges, providing easy access and liquidity for investors and because of the influence bitcoin has on the cryptocurrency market let us see the impact of its exchange traded funds.

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INCREASED ACCESSIBILITY TO INVESTORS

The first major and significant impact of the introduction of the bitcoin exchange traded funds in the crypto space is that it has significantly increased the accessibility to bitcoin this basically means that because of the bitcoin exchange traded funds it is now easier for investors big and small to access bitcoin and it is easier in the sense that with the bitcoin exchange traded funds,

They do not need, that is the investors are not required to have any knowledge about cryptocurrency, cryptocurrency wallets, exchanges and so on before participating and becoming one of the users of the cryptocurrency space and ecosystem and seeing as the challenge and set back of requiring and acquiring knowledge about the crypto space and bitcoin experienced in direct investment is no more as a result the accessing of bitcoin is simpler.

By the process being simple it encourages and allows for increased accessibility by basically allowing investors to buy shares that represent bitcoins without the need to directly own or store the cryptocurrency, this increased accessibility has opened the doors for traditional investors, including those who may not have previously considered crypto as an option, they have begun to invest in bitcoin with the ease and less complications making bitcoin more easily adopted by investors.

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INCREASED LIQUIDITY IN THE CRYPTO MARKET

The sub heading of this paragraph says increased liquidity in the crypto market, this therefore is another significant and major impact of the introduction and implementation of bitcoin exchange traded funds, the bitcoin exchange traded funds have been able to successfully increase and provide the crypto space and cryptocurrency market with more liquidity seeing as trading on the exchange traded funds are done in large volumes and quantities.

The bitcoin exchange traded fund and any other cryptocurrency exchange traded fund is basically traded on the traditional stock exchange and when the demand for bitcoin exchange traded funds arises because of the increased accessibility to investors, the fund managers or authorized participants who is responsible for creating or redeeming the shares of the exchange traded fund will have to buy or sell bitcoin on the open market, which increases the trading volume and as well liquidity.

Liquidity is basically dependent of the demand of the cryptocurrency which is bitcoin, the higher the demand the more liquid it is therefore, this additional liquidity can help reduce price volatility in the bitcoin market and also help and facilitate the improvement of the bitcoins price discovery mechanisms as a result leading to more stable pricing of the bitcoins this therefore in turn attracts more investors, as the risk of volatility is reduced and the ability to execute trades quickly and efficiently is enhanced.

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POSITIVE IMPACT ON REGULATORY DEVELOPMENT

Another yet, significant and major impact of the creation and introduction of bitcoin exchange traded funds is that they have been able to help influence and create a more calm and not so hostile relationship between quite frankly cryptocurrency as a whole and regulatory bodies, this positive change is a result of the process of creating and setting regulatory guidelines for the bitcoin exchange traded funds.

During this process they basically have also looked into, and deliberated on the creation of a less hostile regulatory framework for cryptocurrencies in general and this positive influence on regulations and regulatory bodies serves just as the first step into a more acceptable and stable regulatory framework for cryptocurrencies and any other digital or blockchain based assets and tokens this will in turn increase the adoption of bitcoin as well as other cryptocurrencies.

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POSTIVE INFLUENCE IN THE DEVELOPMENT OF OTHER CRYPTOCURRENCY ETFs

Another significant impact of the introduction of bitcoin exchange traded fund is that they have the potential to play the role of facilitating the introduction and growth of other cryptocurrency exchange traded funds, bitcoin has always acted as a pioneer, spearheading the growth, rise, fall and even market price movement of the general cryptocurrency market and there is no reason why the same won't be the case here, it has already started by maintaining and gaining the acceptance of the regulatory bodies in its exchange traded funds.

Hopefully by doing so other cryptocurrencies like Ethereum, Litecoin, or other prominent digital assets are soon to follow and having their exchange traded funds as long as the bitcoin exchange traded funds is successful and continues to operate smoothly, regulators may be more inclined to consider approving the exchange traded funds based on other cryptocurrencies as a result creating a growth and expansion in the cryptocurrency market that could enable investors to diversify their crypto portfolios without direct ownership of multiple assets, while also increasing the legitimacy of the entire cryptocurrency market.

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CONCLUSION

In conclusion, the introduction of bitcoin exchange traded funds have had many positive significant impacts on the crypto space, increasing the accessibility and adoption of bitcoins as well as the growth and adoption of other cryptocurrencies not only that it also helped and facilitated the provision of market liquidity to the cryptocurrency market and so on however, there are some little challenges to address, particularly in managing volatility and regulatory scrutiny of bitcoin as a cryptocurrency.