Do Bitcoin ETFs conflict with Bitcoin's original ethos?
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Do Bitcoin ETFs conflict with Bitcoin's original ethos?
New Bitcoin ETFs are clearly not cypherpunk, but they very much align with the founding ethos of "Digital Currency Rising."
Navigating Web3 tides with focused insightsAuthor: JPKoning
Translation: Songxue, Jinse Finance
Some argue that Bitcoin ETFs are absurd because they contradict Bitcoin's original ideals. On the contrary, I believe they are highly appropriate.
It would be a misunderstanding of Bitcoin’s history to think that cypherpunk idealism gave rise to the movement. Bitcoin could never have launched without a massive dose of old-fashioned greed. In Bitcoin parlance, this greed is often referred to as “digital gold,” and it has been essential from the very beginning. The new Bitcoin ETFs are clearly not cypherpunk, but they perfectly align with the founding spirit of digital gold.
If you recall, one of the main goals of the cypherpunks was to create anonymous digital cash. While Bitcoin certainly has roots in cypherpunk ideals, it quickly became evident that digital gold and the dream of digital cash were incompatible—after all, a volatile asset isn’t suitable as a medium of exchange. Soon enough, the narrative of digital gold drowned out the cypherpunks’ voices.
I remember walking into the Bitcoin Embassy in Montreal back in 2014, located at the busy intersection of St-Laurent and Prince-Arthur. I had already been researching and writing about Bitcoin for years, but decided to play dumb to see how the embassy staff would introduce newcomers to Bitcoin. Instead of preaching to me about making Bitcoin payments from my self-hosted wallet, the ambassador led me to a large screen displaying Bitcoin’s price. “Look, the price is going up,” he marveled.
In short, that is Bitcoinism. Like the televangelists of the 1980s—with their gold-plated cowboy boots, mansions, private jets, and a touch of God—Bitcoin runs on price charts, plus a dash of cypherpunk ideology.
Digital gold has always needed to bring more people into the game. Unlike a public company, it doesn’t generate an ever-increasing stream of profits, so the only way its price can keep rising is by recruiting more participants—much like a pyramid or Ponzi scheme. From the outset, gaining access to traditional finance and banking infrastructure has been key to making this recruitment process as smooth as possible.
Ever since the first Bitcoin exchanges emerged in 2010, efforts to integrate Bitcoin with existing financial systems began—connecting these platforms to critical global bank transfer systems such as SWIFT, as well as domestic systems like the Fedwire system in the U.S. and SEPA in Europe. These integrations were crucial for injecting the initial rounds of capital into the Bitcoin ecosystem and pushing prices past $1, $10, $100, and then $1,000.
Then came bridges to Visa/Mastercard debit and credit card networks, tightening Bitcoin’s link to the conventional world and bringing in more capital and further fueling the digital gold narrative. Later, Bitcoin purchases were added to mobile payment apps like PayPal and Cash App. Seen in this light, ETFs aren't really anything new—they simply represent the next integration between these two worlds.
As for mainstream finance, it hasn't complained. Companies like Visa exist to generate profits—their natural instinct is to add new products like Bitcoin to their growing list of connected offerings. Interestingly, no chain-letter-like product has ever achieved the same level of adoption as Bitcoin.
Now that Bitcoin ETFs are here, the digital gold narrative needs even deeper ties to traditional finance and banking. What comes next? One possibility: expect the Bitcoin community to lobby for federally chartered banks to offer Bitcoin products beyond just savings deposits and retirement accounts. While banks offering Bitcoin to retail customers may seem inconsistent with Bitcoin’s more cypherpunk ideal of replacing the banking system, conversely, it’s hard to imagine a more powerful recruitment tool for the digital gold story.
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