Quote from: okthen on July 05, 2014, 10:02:56 PM

Quote from: notung on July 05, 2014, 07:42:39 PM

I have a few questions regarding the Winklevoss Bitcoin ETF and its effect on price. I keep reading that it will make skyrocket the price of bitcoin. However, I don't see how. Let me explain:

As far as I know the Winklevoss ETF consists on putting on the market shares representing the value of the bitcoins held by the twins. Let's say they have 100.000 BTC and they will create 1.000.000 shares (hypothetical numbers). I would expect that the price of each share would be calculated according to the price of BTC at the moment of the IPO. Afterwards, the price of the shares would change depending on supply/demand. How can this supply/demand of the shares affect the price of bitcoin in markets like Bitstamp/Huobi/etc? If the Bitcoins held by the brothers are not sold or they don't buy more, how can it affect the price?
The way that I understand it is that the price of the shares will be highly influenced by the value of bitcoin, but not the other way around!

Am I missing something? Otherwise, just let me know how the shares can affect the price of BTC.

Thanks in advance for clarifying my doubts!

As people said, they'd eventually buy more.

But I actually think the effect it will have will be more undirect: a big name like the Winklevoss will make other big Wallstreet investors aware and more likely to trust bitcoin.

AN ETF is a regulated instrument ....@ a certain tipping point ratio they MUST buy more ...otherwise they are in breach and it can be wound up etc