SharperDingaan

You might want to go through the prospectus again; they have disclosed (and remained silent) on everything they need to. This thing has no actual BTC; they maintain their exposure via derivatives plus T-Bills, and say as much. They also have discretion to pay dividends to reduce the ETF's price volatility, and are not tied to an amount or frequency. It looks like they are working towards splitting the fund; one fund that tracks BTC very closely, but does not pay a dividend; and another fund that tracks BTC less closely in return for a variable monthly dividend. The prospectus is silent on the definition of 'closely tracks', and their messaging could use some work. Not to recommend one over another, but you might want to look at the Purpose Investment funds; multiple crypto funds, two of which are BTC funds - one of them a dividend payer. Notable is that these funds existed well before BITO, and the Canadian regulatory review/experience was quite likely a building block that the SEC drew upon. https://www.purposeinvest.com/thoughtful/purpose-investments-launches-worlds-first-bitcoin-etf-invested-directly-in-the-digital-asset We use these funds as our primary crypto vehicle, largely because as Canadian investors we have far better regulatory protections than we would have were we to use a US based equivalent. We have no desire to compound crypto risk on top of market risk as well. SD

Most would expect that they are selling options, and replacing underling BTC with the derivative equivalent; premium income, plus derivative leverage, releasing cash to fund the dividend while keeping net exposure the same .... the ETF itself ending up as a portfolio of primarily T-Bills and BTC derivatives. Options also gets them around the daily MTM on any BTC pledged as collateral. SD

A lot of this is also risk management and time horizon; long-term vs short-term looks very different. Our newer vintages are all 5-10 year holdings, and include BNE.TO, GXE.TO, CET.TO, and a BTC-ETF. All large share counts, and each a life-changing position should it work out as we hope; BTC-ETF held as the other side of swing trades as we go through the holding period. BNE has ridiculous share count, GXE a ridiculous dividend, CET is a 'forever' call on drilling eventually returning, BTC-ETF as the high-return/low-correlation diversifier. Why a BTC-ETF? BTC is currently USD 61K; if you expect around USD 85K by year-end, you anticipate a 39% return. However, if you also have the discipline to trade the volatility, you can expect an additional 12-15% per swing-trade round trip. The ETF is much more liquid and cost effective, and pretty hard to argue against. SD

Look at the cdn small-mid caps, but screen only against periods when the netbacks were similar. Today's differentials and costs are a lot lower; today's usd 80 wti is the 100+ wti back in the day. Names aside, you will also see just how undervalued everything currently is relative to the underlying economics. There is a reason why WEB is looking at the WCSB. SD

When used in a currency application; a stablecoin is little more than a bad currency peg, that instantly becomes obsolete as soon as one of the pegged currencies has a CBDC. It's essentially a collateralised debt obligation with high ongoing fees and the new instrument as the stablecoin. Developers with no other financing choice, using exploitable currency pegs, that routinely collapse. Whereas, when used in an automation application, stablecoin offers off-shore suitcase bankers lots of promise; arguably, the real target in this first stage of the regulatory arbitrage. SD

The actual details are quite a bit different .... Pathways has not made the final decision yet as they are still awaiting tax credit finalisation; less than two weeks ago it was apparently almost-in-place. Play nice, take down the content today and cite why (Bill C-59); replace with new content in a month after the tax credit is law, and the investment decision has been made. https://boereport.com/2024/06/20/pathways-alliance-oilsands-group-removes-all-website-social-media-content/ "..... Pathways has removed its content due to uncertainty around an anti-greenwashing provision in federal Bill C-59. The omnibus bill,....., contains a truth-in-advertising amendment that would require corporations to provide evidence to support their environmental claims. Some environmental groups have said these ads are misleading, as the Pathways Alliance has not yet made a final investment decision on its proposed $16.5-billion carbon capture and storage network." https://pipelineonline.ca/freeland-to-oilsands-tax-credit-nearly-law-time-to-start-building-carbon-capture/#/?playlistId=0&videoId=0 " Finance Minister Chrystia Freeland says a major federal tax credit to help build carbon capture projects is almost in place and she wants to see quick progress on the project promised by Canada’s biggest oilsands firms." ... This isn't just a tax-credit; it will also enable low-rate financing on the typical federal/provincial/municipal formula, with the federal portion delivered via the Canada Infrastructure Bank. https://cib-bic.ca/en/ SD

There will also be enough very unhappy newly unemployed oil workers all over BC/Alberta/Saskatchewan, to make it very difficult for whichever political party is ruling Canada at the time. More rounds of protest in Ottawa, and everybody singing/pushing for more CCS and higher tar-sand production, or they are out of a job tomorrow. SD

Even if it passes, it may well be repealed later or just not enforced. Should the oil-sands have to take write-downs it will not just be less economic activity overall, it will be a less tax revenue as well; and Ottawa making multi-billion transfer payments to the western provinces versus the other way around. Most would expect new political faces well before then. SD

Quite agree, but technology waits for no man. Ultimately there will be NO reserve currency and we'll all be using supra-national DC for trade settlements. Only question is how long it takes to get there, and the path taken. In the meantime, lots of drama. SD

It used to be that one kept most of ones surplus wealth denominated in the reserve currency of the day; usually that of the country with the greatest global military and economic power, and preferably in assets inside that country's borders. Typically diversified across real estate, treasuries, blue-chip stocks, bullion. etc. - and one assumed a 100% loss of all other assets. One also maintained 'affiliations' with the trading pipes of the day; moving/transporting commodities priced in reserve currency, from source through to industrial user; both as a means of making a profit, and as a means of evading capital controls. Bitcoin protocol fundamentally changed this. The app (BTC), and CME options/futures, allows one to both bypass reserve currency entirely, as well as the purchase of assets in that country. The protocol, replacing reserve currency itself, via a supra-national DC. Not what many would prefer to hear. Assets can now be diversified across real estate, treasuries, blue-chip stocks, bullion, BTC, etc. - and BTC is a better portable fit for purpose, that many of the other choices. If you see wealth as a zero-sum game, the resultant lower weighting to the 'traditional' assets must result in a price decline. Of course most people aren't wealthy, they need to work, they aren't represented here, and they see much of this as abuse. There is a reason why Brexit, Trump 1.0, and the European shift to the right occurred. Trump 2.0 is a continuation. Opportunities everywhere, but it's a dangerous game ... and getting worse. SD

Higher US rates near term, devaluing USD long term. When the world doesn't need USD anymore to pay for its purchases (oil); all else equal, if the US is to maintain the same level of USD demand, one approach is to raise interest rates so as to be competitive. Higher interest rates, cooler economy, lower inflation rate; great for the economy ... not so much for the market. Another approach is long-term USD devaluation relative to competitors. Manufacturing moves on-shore, higher USD demand as more US manufactured goods are bought. Same interest rate, higher employment, hotter economy, higher inflation rate; not so hot for the economy ... but great for the market. If you believe that reserve currency (USD) is in the process of being replaced with a 'supra-national' sovereign digital currency .... weakening reserve currency status is very smart. If you think otherwise .... it's dumb as a rock. Lot of opportunity, but you need to be nimble. SD

You folks might want to re-calibrate, as the Petrodollar recycling has now ceased. When you don't have to buy USD to pay for things, the US has to try harder to make the USD attractive. If the Fed cannot raise rates (and thereby lower inflation), it will have to devalue the USD instead, and raise employment as trade moves on-shore. Higher discount rates lowering valuations. SD

Inflation is ya friend. Today's new field &/or pipeline will either be economic, or written down to today's economic value; but if there is an economic write-down ... no other competing field/pipeline will be developed, and the existing build will have a monopoly for the rest of its economic life. A moat that will generally get stronger every year as inflation continually does its thing. It's a cyclical industry. From time-to-time, at the depths of the cycle, liquidity demands will often force a sale of these assets at cents in the dollar; as they are deeply uneconomic at the time, and cash-flow negative. That now 30-40 year life asset becomes available at 30c on the dollar, plus the negative carry until the cycle turns. Thereafter it's a new day; and you're a monopolist with no competitors, minimal upkeep, deep tax pools, and no taxes ... for quite some time; hallelujah! Ya dance with the one that brung ya, and ideally hedge her near the top of the cycle. Then ya dance with her all the way down; keeping the 'funny money' along the way. Treat her right, and she'll buy you a dream retirement. SD

Not so sure ..... Re the abstract excerpt, he's trying to change the gaming payoff on the BTC protocol POW consensus mechanism, and make the BTC protocol create secure data instead of a BTC. 'BTC protocol' is blockchain (using a POW vs 'other' consensus mechanism), and 'secure data' is simply a NFT version 2.0 block; created via BTC protocol, and accessed via a smart contract linking to a server (military) containing the code. Smart contact executing based on a linked time stamp and consensus mechanism, that changes multiple times a day. Thing is, what does the anonymous miner get paid in? either its anonymous BTC, or its the local currency of a captive domestic mining pool; i.e; space force over-investment in space force supercomputers (hash force) dedicated to mining, and using the surplus CPU capacity for simultaneous backups. And two platforms ..... 1) BTC protocol to confirm the veracity of new sensory data (slow); 2) private network to process the now confirmed data (fast). The good news is that the civilian version would offer a great deal of utility in quite a few global economic applications; and if there ain't no social licence for this approach, there ain't no show. Wise men would do pilot economic applications first. SD "[ This thesis introduces a novel theoretical framework for analyzing the potential national strategic impact of Bitcoin as an electro-cyber security technology rather than a peer-to-peer cash system. The goal of this thesis is to give the research community a different frame of reference they can utilize to generate hypotheses and deductively analyze the potential risks and rewards of proof-of-work technologies as something other than strictly monetary technology. The author asserts it would be beneficial for researchers to explore alternative functionality of proof-of-work technologies to eliminate potential blind spots, provide a more well-rounded understanding of the risks and rewards of proof-of-work protocols like Bitcoin, and positively contribute to the development of more informed public policy in support of the March 2022 US Presidential Executive Order on Ensuring the Responsible Development of Digital Assets and the May 2022 US Presidential Executive Order on Improving the Nation’s Cybersecurity. Utilizing a grounded theory methodology, the author combines different concepts from diverse fields of knowledge (e.g. biology, psychology, anthropology, political science, computer science, systems security, and modern military strategic theory) to formulate a novel framework called “Power Projection Theory.” Based on the core concepts of Power Projection Theory, the author inductively reasons that proof-of- work technologies like Bitcoin could not only function as monetary technology, but could also (and perhaps more importantly) function as a new form of electro-cyber power projection technology which could empower nations to secure their most precious bits of information (including but not limited to financial bits of information) against belligerent actors by giving them the ability to impose severe physical costs on other nations in, from, and through cyberspace. The author calls this novel power projection tactic “softwar” and explores its potential impact on national strategic security in the 21° century. Like most grounded theory research efforts, the primary deliverable of this thesis is a novel theory rather than deductive analysis of a hypothesis derived from existing theory. ]"

"In his 1st term he created the Space Force, in his 2nd term he may create a Hash Force." The man forgets that blockchain is only a digital asset; tamper-proof data is worth squat if your computers are fried, can't talk to each other, or are without electricity to power them. Lot of the followers also seem to view BTC/Blockchain as interchangeable; a very exploitable misconception. SD

This isn't the Bitcoin that most people think of ..... It is more along the lines of FDIC coverage of the FDI insureds BTC-ETF. Should the FDI insured get hacked and its BTC stolen, it's not the depositors (i.e. you) problem so long as you had < 250K of the insureds BTC-ETF at the time of the hack. Deposit insurance that is currently at 250K, if CBDC/BTC-ETF is considered a cash equivalent ...... and therefore affects most people. Clever market solution, that de-risks BTC quite a bit, concentrates activity within the BTC-ETF swim-lane, and concentrates deposits within the banking system. Retail need no longer trade BTC-ETF on their favourite app; when they could do the same thing at their bank, along with 250K of free hacker insurance. Of course, BTC itself still trades; but now the trades are between professionals. We live in interesting times. SD

Holding back too much. Back in the day when Russia was breaking up, some friends and I got access to a military warehouse. Whatever we wanted, including transportation to the border, as long as we paid in untraceable USD, and weren't buying weapons. We did very well (after a lot of work!), but barely scratched the surface of what was available to us. An additional 3-5 truckloads would have set us up for life very early on, at almost zero incremental risk. When you have the brass ring, keep pulling on that sucker for everything you're worth! SD

After automatic deduction of pension contribution and mortgage; living paycheck to paycheck is quite normal, and just not a problem. Your job is to just stay employed, and have a large enough 'emergency fund' (credit line/savings) to cover your outflows between jobs. Pay down/eliminate your mortgage, and your 'emergency fund' can be a lot smaller. Do whatever you want with your net take-home, and just let your nest egg keep building every month. The press 'yapping' on most people being < $X away from financial disaster .... ignores their access to credit lines, credit cards, etc.; it's factoids being quoted out of context to create a story. And of course ... 'frames' an asset collection game! Now, should the press/bookie also be prone to sipping the cool aid .... an enterprising lad/lass could expect quite the opportunity from time to time! Even a GS/UBS will reliably screw up every now and again .... but as they are far more valuable alive than bankrupt, it really just comes down to the fire sale price for the ticket; cheap today, but expensive next year! SD

Smuggling friends like to remind me that digital tracking (crypto), is utter sh1te when we all live in a physical world! For the most part; one needs to either disable removal of the physical from the digital track, time limit the digital track, or turn the physical into both a physical and a digital track. The better applications are around diamonds and barcodes imprinted on the skin of produce (produce rots, barcode becomes unreadable, digital track drops). SD

Lot of folks think the Europeans actually have it right; drive towards the 'average' where most people actually are. Rich or poor, everyone in the same group/class is pretty much the same, needs to live somewhere, and if you like the culture and want the best work-life balance possible ... it's pretty hard to beat. Doesn't mean the outliers have to make their money there, but once you have your stash; would you prefer to retire to New York/San Francisco, or a Paris/Barcelona/Milan/Brussels etc? Wealth just gives you options, but to realise that - you either have to be wealthy, or have learnt it from others who are wealthy. If you never learn it, you have no reason to think anything is amiss ('cause the majority of people, that 78%, is just like me!), and ignorance is bliss. So don't tell me how I'm being manipulated .... and get the f*** off my cloud! Key is that you don't have to work in the same place that you retire to, and we have reliable transportation that will quickly get us to/from almost anywhere. We just don't think of a lifetime of working in NA, and a retirement in a different part of the world. Ever the heretic! SD

Just to throw it out there. Think of the crypto asset class as 4 layers; 1) BTC, 2) Utility Token, 3) Non Fungible Token, 4) ‘Crypto Builders’. Pyramid of BTC on top, ‘Crypto Builders’ on the bottom, lower the layer in the pyramid the more ‘fluid’ it is. For most, access to the asset class is via a Crypto-ETF. The higher the layer and the more ‘investable’ the asset, the higher the asset weighting in the pyramid. High weightings for BTC and ETH as the CME option and future markets make these investments both liquid and hedgeable. Crypto diversification by functionality, portfolio optimisation via var-covar price optimisation. Assume a layer 1 of one asset, layer 2 of two assets, etc, etc. It implies one additional and very different utility token, plus three additional and very different NFT vehicles; and each with a separate CME option and futures market. 4+ global ‘Crypto Builders’, each with the standard common share financial options market. All transactions within a layer eventually settled exclusively via CBDC (as anti-money laundering protection). Crypto stacks within each layer; within the BTC layer, BTC as level 1, CBDC/Lightstream as level 2, etc. 'Crypto Builders' resembling the US auto industry of old; where there used to be many constructors, M&A over time eventually shrank it to 3. All still very much an evolving industry, but now the adults are in the room. However, develop your own model around how this evolves, and you could do very well indeed Different PoV SD

Quite agree from the tech PoV. But it's radically different in the investment PoV, when crypto is also considered an asset class. As ETH also has CME options/futures, and is functionally very different to BTC; it's also a preferred choice for asset class diversification. ETH may be clunky, but its very useful 'white label' token, and not going away anytime soon. SD

The mortgage thing comes down to risk tolerance, and degree of interest. Of course there are lots of financial alternatives, but most of us would prefer to spend the bulk of our attention/energy on other than just 'finance'. The reality is that the tail doesn't wag the dog, and the older you get the less risk tolerant (the simpler the better) you become. It is also about how you propose to maintain your long-term mental health. Overworking to make the payments on over indebtedness (dying from stress), is as bad as underworking because you no longer have to (dying from boredom). Most people regard working a reasonable number of hours at something they like as healthy; and if the money isn't needed - it could make mortgage payments. It's essentially a state of mind; perhaps best expressed in the famous quote from The Apprenticeship of Duddy Kravitz (Mordecai Richler), "a man without land is nobody" - substitute a mortgage free house for land. The Apprenticeship of Duddy Kravitz (film) - Wikipedia SD

ETH will be approved for crypto ETF's simply because ETH provides a solid measure of diversification, and there are also CME options/futures available by which to hedge. Displace some of the global demand on BTC, and both the volatility of BTC and a crypto ETF portfolio declines. Not a bad thing, when attempting to get widespread IPS approvals for crypto holdings. SD

Pay the mortgage off thing .... at the simplest level this is the house/apartment that you own and live in (ie: principal residence in Canada). 6 main benefits; Financial control. Pay the mortgage off, and your monthly dividend is tax-free savings on the now cheap shelter (no mortgage) in a very nice neighbourhood; money works for versus against you. Efficient taxation. Borrow against the portfolio to pay the mortgage off, and the margin interest paid is tax deductible; tax man works for versus against you. (Smith manoeuvre) Less stress. The lower the mortgage the less you need to come up with every month; a big deal if you have a variable income, as there will inevitably be some occasional down years. Life enhancer. Kids are expensive; lower your mortgage payment ('cause you paid some of the mortgage down) and the more you can afford them! Obvious, but seldom recognised by many. Life changer. Hero today, bum tomorrow; but pay off your mortgage early; and you're a bum with both a pot to piss in, and the wherewithal to start again. Anti-fragile. The worse the economy gets, the more the paid-off shelter contributes to your well being. Can't be evicted next month and made homeless, because you couldn't make the rent or mortgage payment. As the portfolio gets more volatile/bigger there are other benefits as well; but it requires more sophistication, particularly when there is a high weighting to commodities and BTC SD