On-chain crypto analyst Willy Woo has suggested that a bitcoin futures exchange-traded-fund (ETF) in the United States may be bad for retail investors as it places institutional investors such as hedge funds at an advantage.

“If a bitcoin futures ETF is approved, in my opinion, it will be an expensive way to hold BTC,” said Woo, in an Oct. 8 thread on Twitter. “The exchange-traded-fund effectively outsources the holding of bitcoin to hedge funds through a chain of profit incentives,” he opined.

The U.S. Securities and Exchange Commission (SEC) is largely expected to approve a bitcoin ETF that invests in futures contracts later this month. Applications from Proshares, Invesco, Vaneck and Valkyrie are primed to get the go ahead, according to a Bloomberg report. The crypto market has long-awaited such an approval, believed to be behind bitcoin’s current bullish run.

A bitcoin ETF will generally track the price of BTC, allowing investors to gain exposure to the digital asset, but without actually having to buy it directly themselves. Investors may tend to lean towards ETFs because, among other reasons, its a much easier way to get into bitcoin.

Willy Woo argues that a bitcoin futures exchange-traded-fund has the “potential for price suppression and more volatility due to futures dominance.” That’s because, with time, he expects BTC futures to get more expensive compared to spot due to large, long positions opened by hedge…

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