Even if Coinbase goes bankrupt, the underlying Bitcoin of spot Bitcoin ETFs will not be commingled, 21Shares and 21.co co-founder Ophelia Snyder says.
As 10 asset managers in the United States have started trading billions in spot Bitcoin (BTC) exchange-traded funds (ETFs), investors might wonder how these issuers ensure that the underlying asset of their products is safe enough.
Despite cryptocurrency exchanges losing comparatively less money to hacks over the past few years with new security improvements, the community witnessed multimillion-dollar attacks on exchanges like Poloniex in 2023. Is there anything that makes a spot Bitcoin ETF safer than trading on an exchange like Poloniex as a retail user?
Bitcoin custody products used by spot Bitcoin ETF providers are “nothing like what retail gets access to” on crypto exchanges, according to Ophelia Snyder, co-founder of 21Shares and its parent firm, 21.co.
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Source: https://cointelegraph.com/news/spot-bitcoin-etf-storage-btc-vs-exchange