First of all this isn’t an original idea, I read something somewhere and will definitely go pull the source. The general theme was that as paper bitcoin increase(etfs,dats etc) there will be less circulating bitcoin and thus transactions fees will be impacted negatively. It sounds plausible, I’m a bit stuck on the a holder is a holder no matter where they are self custody or third party, but do you think this will have cause transactions to drop off over time as more adoption happens on the paper side?
I think I would say that everything in this life comes with their advantages and disadvantages, and in everything we get, something must have to be sacrificed for it, like for example, you want money, and to get money, you must sacrifice both your time and energy and or your thinking ability and knowledge on something that you have to do for that money to come to you...
So also the ETFs, ETF came, it was approved and we all jubilated because it marked another level of adoption for Bitcoin and the cryptocurrency ecosystem at large, it came with its advantages as people can now own bitcoin even without knowing anything about the bitcoin blockchain or even how to use a self custody bitcoin wallet...
But then, many of us do not also look at the disadvantage back then which is that if more people start patronizing buying bitcoin through ETFs rather than owning the real bitcoin from crypto exchanges and moving them to their own personal wallets, transaction on the bitcoin network will significantly drop, and this may likely have a negative impact on the security of the network as some miners may drop due to mining no longer being as profitable as it should be.
This is my personal thought.