Bitcoin continues to hold above $67,000 per token, yet it struggles to break back above the $70,000 mark after a steep decline from its record high last October. As Wall Street and traditional institutional investors increasingly adopt cryptocurrency market exposures, especially through ETF products, some notable disadvantages have emerged.
One significant change is an increase in volatility tied to traditional market hours. Since many crypto ETFs are bundled into stock market schedules, we’re now seeing distinct trading patterns. There often seems to be a buildup on Sunday night, followed by significant price movements on Mondays—or, in some cases, Tuesdays after a holiday. It’s become common to see a drop shortly after the market opens in New York, creating new opportunities for arbitrage but also adding layers of short-term price pressure.
Beyond the immediate trading patterns, there’s a fundamental shift in the motivation behind investing. In the early days, the vast majority of people buying crypto were true believers in the underlying technology and its potential to change finance. Today, that’s often not the case. Large financial institutions and many retail investors alike are primarily motivated by profit; they want the “number to go up” (or down, depending on their position), with less focus on the long-term vision that originally defined the space.
This shift is a move from fear to greed as a primary driver. Early adopters were often driven by a fear of government money debasement, similar to the mindset of a “gold bug.” Now, the dominant force is greed, leading to new layers of financialization. The current buzzword is “yield.” Everyone with large holdings of Bitcoin or other cryptocurrencies is looking for ways to generate a return on those assets, moving beyond simple price appreciation.
This new era of “yield 2.0” is distinct from the risky practices that led to past failures. Investors are now seeking solid, fundamental ways to put their digital assets to work, much like someone with a large cash balance would seek a high-yield savings account. As economic conditions change, such as potential drops in interest rates, this search for yield could pull liquidity into the crypto space, further accelerating demand behind the scenes while many retail investors simply react to price headlines.
