No single ticker was named. Crypto & blockchain ETFs are one way for retail investors to get exposure. Not a recommendation.
Crypto ETF launches face a liquidation wave
The guest argued that while issuers will launch over a hundred derivative, leveraged, and covered-call crypto ETFs, a massive wave of liquidations will occur within 12 to 18 months due to a lack of underlying interest in lower-market-cap assets.
The argument
Issuers are using a 'spaghetti cannon' approach, throwing numerous niche crypto ETFs at the wall to see what sticks because regulatory streamlining has made launching them cheaper and easier. However, the guest noted that assets ranked lower on the market cap spectrum cannot support multiple competing ETF products without sustained retail momentum.
The thesis, stress-tested
✓ What validates it
- ✓A wave of crypto ETF closures and liquidations occurring 12 to 18 months post-launch
- ✓Low assets under management (AUM) and negligible daily trading volume in newly launched mid-cap crypto ETFs
▸ Risks discussed
- ▸A sudden momentum spike in a niche asset could make a dormant ETF highly profitable, incentivizing issuers to keep them listed
Hear it yourself
"So my take in December before things started getting really bad was, like, we're gonna see a lot of these things launch, and then within twelve to eighteen months, we're gonna see a huge wave of liquidation just because, one, if you get down the list of, like, the largest crypto assets, and you get, like, the number 20, like, can that…"
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