The psychology of owning a whole asset rather than just a portion of it makes investors feel more happy, and this is especially true with Bitcoin, according to VanEck advisor Gabor Gurbacs.
Unit bias psychology, which favours holding full units, can make potential investors reluctant to purchase only a portion of the cryptocurrency, but the price of a single Bitcoin can discourage them, according to VanEck consultant Gabor Gurbacs. He proposes that an answer to this problem is the use of Bitcoin exchange-traded funds (ETFs).
Gurbacs claimed in a string of tweets on X (formerly Twitter) that a lot of people are still ignorant that they can own a portion of a Bitcoin and hinted that even more people would want to possess only complete assets:
“I was surprised that a good number of people didn’t know that one can own a fraction of a Bitcoin and even more frequently people didn’t want to own a fraction of a coin.”
He also restates the fact that full ownership of an asset appears more desirable to investors than fractional ownership.
It feels better to own a whole share than 0.001 Bitcoin. It may seem little, but it’s a major deal,” he said. Gurbacs contends that biases are among the most useful instruments for comprehending markets, despite the fact that he acknowledges that this argument is not new.
“Unit bias psychology is important, but it’s simplistic. I give this a lot of thought,” he continued.
A spot Bitcoin ETF is expected to be approved by the US Securities and Exchange Commission (SEC) in the coming week, according to industry forecasts.
The financial services sector as a whole, however, is less optimistic about its likelihood of occurring. Only 39% of U.S. financial advisers responded to a recent Bitwise study that included 437 financial advisers when it came to their predictions for the adoption of a Bitcoin ETF in 2024.
According to recent reports, the last preparations are on for the Wall Street debut of a spot Bitcoin ETF, with asset managers anticipated to provide their final adjustments by the morning of January 8.
Before the start of operation, the adjustments must be reported through S-1 filings, and applicants are required to disclose the remaining fees and tickers. BlackRock has not yet made the costs related to its ETF public.