Who Will Be The Next Spot Bitcoin ETF Issuer To Support BTC Developers After Bitwise And VanEck?
Of the 11 financial institutions that issued spot Bitcoin ETFs in January 2024, only two Bitwise and VanEck have pledged to donate a percentage of their profits to open-source Bitcoin development.
Regardless of whether large holders are harassing ETF sponsors for funding core dev, the real question is - why are only @BitwiseInvest and @vaneck_us doing so? Bitcoin is an ongoing project and core dev continues to be underfunded
nic "bankful" carter (@nic__carter) April 10, 2024
In considering the logic behind Bitwise and VanEcks decision to donate to developers who maintain and update the Bitcoin protocol, its difficult to imagine why more spot Bitcoin ETF issuers havent followed suit.
While we use the language of donation when we support devs, I think in reality it's closer to a self-investment into making the asset itself stronger, Hong Kim, co-founder and CTO of Bitwise, wrote in an AMA thread on Stacker News. Many people think Bitcoin just magically gets maintained, but that's not true! If you manage a large pool of Bitcoin and you take fees for doing so, then why would you not reinvest some of that into the underlying infrastructure?
For this reason, Bitwise, which issued its spot Bitcoin ETF under the name Bitwise Bitcoin ETF (ticker: BITB), committed to donating 10% of its ETF fee profits to three different nonprofits that fund Bitcoin Core developers OpenSats, Brink and the Human Rights Foundation (HRF) for 10 years.
Brink, OpenSats and HRF were the most established nonprofits with a track record of funding Bitcoin devs they had the proof of work, so to speak, Kim told Bitcoin Magazine.
VanEck, which issued its spot Bitcoin ETF under the name VanEck Bitcoin Trust (ticker: HODL), also sees the value in supporting Bitcoin Core developers. Hence, it promised to contribute 5% of HODL profits to Brink as well as make an initial $10,000 donation to the organization.
We believe TradFi stands to gain from the efforts of Bitcoin's Core contributors, Matthew Sigel, Head of Digital Asset Research at VanEck, told Bitcoin Magazine.
As we stand to profit from Bitcoins price increase, it makes sense that we also give back to the work of the innovators who make the chain possible, he added.
Given that its only sensible for spot Bitcoin ETF issuers to give back Bitcoin Core developers those who support and further the underlying asset for their financial product which will be next to follow Bitwise and VanEcks lead?
The development of Bitcoin and open-source scaling solutions for the protocol could benefit significantly from more of these major financial institutions donating even a small portion of the profits from their spot Bitcoin ETF fees.
Text source: Bitcoin Magazine: Bitcoin News, Articles, Charts,
