Is there any guarantee that if this goes wrong (let's say ETF's are hacked and lose their BTC) then assets in other ETF's are safe?
Let's say BlackRock ends up on the hook for billions after their BTC ETF goes wrong. Are my shares in iShares NASDAQ 100 ETF safe?
I want to make sure I don't have any exposure to crypto world by owning stock ETFs. If there is any scenario that I am on the hook for crypto nonsense going south I am going to sell and just own selected stocks instead. I would greatly appreciate someone providing clarity on this issue.
I can only speak for EU (Ireland) domiciled ETFs, but there shouldn’t be any possibility of such contagion: something highly liquid like NASDAQ 100 will be 100% physically replicated with the assets held by a custodian. The collapse of a separate ETF that happens to have the same manager will not have an impact on the rights of shareholders of another ETF to the assets backing the fund.
I know nothing about the legal vehicles used for US domiciled ETFs, but I would assume the situation is the same.
Talk to a financial advisor before making decisions based on this information.
> Is there any guarantee that if this goes wrong (let's say ETF's are hacked and lose their BTC) then assets in other ETF's are safe?
They're as safe as any other share or ETF of a company that could be hacked or robbed/suffer a disaster of some kind, or indeed any regulated bank, broker, exchange etc. As the BTC securities would be a small part of the total value of the Organisations holding them - I would assume that they would be capable of making up of any losses to holders due to their screw up (as happened when Nickel was stolen from a warehouse that was used as backing for Nickel futures contracts).
However, any other external crypto nonsense going south would likely cause BTC to drop!
The question is about assets in one ETF being on the hook if the company goes in trouble. There either is regulation to prevent it or there isn't. I don't think you can answer it with general analysis like that.
You should cash out and only use physical cash as then you would be guaranteed 0 exposure to the crypto financial world. As you will not do that, I'm sure, you will be exposed to BTC and other crypto as they will be held by funds and institutions you necessarily own as part of the financial world.
Sorry but not sorry, there is no more BS around BTC being for "bad actors", now everyone is exposed. Your disdain is not warranted and makes you a loser if you go with the cash option and 0 exposure. Again, sorry but but sorry ...
You’re probably right about this issue. BTC is a bearer asset and is inherently difficult to store right- someone has to know the private key, and that someone could always irreversibly steal the funds (hopefully it’s multiple someones with a multisig). Especially with such a large pot of money all state backed hacker groups are going to be actively hunting for vulnerabilities.
Man, companies involved in crypto currencies trading getting into trouble is about the most common news out there. Making sure I am not exposed to this risk is just basic due diligence not being paranoid.
You may disagree but the view that crypto currencies are toxic assets is pretty popular so the question is worth answering for people who subscribe to it.
I want to make sure I don't have any exposure to crypto world by owning stock ETFs. If there is any scenario that I am on the hook for crypto nonsense going south I am going to sell and just own selected stocks instead. I would greatly appreciate someone providing clarity on this issue.