2026-01-12 10:20:33

As a seasoned veteran in the crypto market, I want to discuss the truth behind this wave of changes.

**Physical Settlement: The Subtle Shift in Bitcoin Identity**

After the US SEC approved Bitcoin ETFs with a "physical settlement" mechanism in July, the rules of the game changed completely. Previously, large investors had to sell coins to buy ETFs; now, they can directly deposit Bitcoin into custodial accounts like BlackRock and exchange it 1:1 for ETF shares. It looks like a technological upgrade, but fundamentally it's a major transformation of asset form—Bitcoin shifting from on-chain code to a financial product, from "decentralized faith" to "regulated asset."

BlackRock's IBIT product alone has handled over $3 billion in conversions. Why are big players willing to give up control of their private keys? Because the benefits of traditional finance are too tempting:

In private wallets, Bitcoin as collateral is almost useless, but once converted into ETF shares, it can be borrowed at low interest rates on brokerage platforms. Some institutions even offer loans up to 70% of the market value. There's also a practical scenario—one large holder who transferred 5,000 BTC said straightforwardly: "I don't want my next generation to mess around with mnemonic phrases or family disputes over inheritance. ETF shares can be directly written into a will, clear and simple."

**Wall Street's "Compliance Trap" and Rational Choices of Large Investors**

Some criticize this as a "betrayal of decentralization," but I see it as pragmatic pragmatism crushing idealism. A CEO of a major asset management firm gave an example: Suppose you have $1 million in assets on a wealth management platform, and $5 million worth of Bitcoin stored in a hardware wallet. What would most people's choice be?

The answer is very realistic—more and more large investors are making this choice. It's not a collapse of faith; it's about finding their own balance between risk, return, and convenience.

BTC1,21%

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GasFeeCryer

· 6h ago

Oh no, this is Wall Street eating up Bitcoin. I really have no more words to complain. --- Wait, if you lose your private key, can you still inherit it through a will? Sounds pretty good, better than relying on me now. --- Pragmatism crushes idealism... No doubt about it, I’ve already compromised long ago. --- BlackRock’s $3 billion conversion volume—once this number comes out, you know how the game is played. --- If I had 5000 BTC, I would have given up long ago. Who really cares about decentralization? --- This move looks cool, but more and more people are transferring off-chain. Something just doesn’t feel right... --- Lending 70%? Using Bitcoin as collateral? Wall Street’s approach is indeed tempting, but isn’t this just the beginning of financialization? --- Basically, it’s a game between convenience and risk. The big players have already done the math.

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WhaleWatcher

· 6h ago

To be honest, I see through this wave of conversion quite clearly. Wall Street is slowly "taming" our Bitcoin. The real big players understand that private keys are too risky. Losing a mnemonic phrase or family disputes can ruin everything. It's not a matter of faith, but of reality. --- BlackRock's physical asset exchange move is truly brilliant. A $3 billion conversion volume is no joke. I just want to ask, who else can resist the temptation of financial leverage? --- Decentralized faith? Ha, that's what people say who haven't experienced low-interest borrowing and collateral lending. Major holders with over $5 million in Bitcoin have already surrendered. --- This is a live demonstration of pragmatism crushing idealism. We're all spectators. --- To be honest, I was also conflicted, but after watching this wave of operations, I understand. It's either betrayal or the smart choice that intelligent people should make.

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Lonely_Validator

· 6h ago

In simple terms, this is the process of big players compromising between reality and faith. Who can blame them, with a 70% lending ratio staring right at us. --- BlackRock's move truly changed the game. The $3 billion volume speaks for itself; money is always more honest than idealism. --- Private keys vs inheritance planning—this comparison hits hard. The next generation really shouldn't have to worry about mnemonics. --- Pragmatism crushes idealism, but don't forget what was lost—those self-managed powers can never be regained. --- Gotta admit, Wall Street's toolkit is incredibly smooth. Once low-interest lending appears, who can resist? That's the real trap. --- $5 million in Bitcoin vs convenient ETF shares—once this question came up, I knew how the big players would choose. Reality is just that harsh. --- Faith ultimately can't compete with a few points of borrowing interest rates. The crypto world needs to reflect.

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WalletDivorcer

· 6h ago

Honestly, the whole private key thing should have been discarded long ago. Inheritance and succession are the real pain points. But is it really safe to just move into ETFs? BlackRock says no move, no move. This risk is just in a different form. Wall Street's honey is indeed sweet, but you have to choose between convenience and freedom. I still feel a bit regretful. Pragmatism has won; idealism is dead. We'll see what happens after this. The big players are all doing this, so what can retail investors do? Follow the trend. If the dream of decentralization is shattered, so be it. As long as the returns are more attractive. This move looks exciting, but what about the aftereffects? No one dares to speak up.

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