Will Bitcoin ETF Issuers Shun Coinbase? Samson Mow Makes Troubling Prediction

Samson Mow, a Bitcoin (BTC) Marxist and the CEO of JAN3 has taken a jab at Coinbase custody service as the biggest custodian service provider for the majority of the spot Bitcoin ETF issuers in the industry.

Spot Bitcoin ETF Address Published by Bitwise

Earlier this week, spot Bitcoin ETF issuer Bitwise published the Bitcoin addresses for its BITB holdings. This made the asset management firm’s BITB the first United States spot Bitcoin ETF to make such a move. The publication of these addresses meant that members of the public could easily verify the holdings as well as their flow on the blockchain, thereby promoting transparency. 

American cypherpunk Jameson Lopp applauded the move but highlighted the fact that pay-to-public key hash addresses was deprecated over five years ago. In response to Lopp’s post, Samson Mow handpicked American Coinbase Exchange to throw his jab at. 

Mow stated that crypto custodians like Coinbase failed to invest so much into their Bitcoin infrastructure. According to him, this was because they were busy “shitcoining”, an exercise that could lead to contamination risk. Notably, when a cryptocurrency is termed a shitcoin, it means that it has little to no value or a digital currency that has no immediate, discernable purpose or value.

Bitcoin ETF Issuers to Migrate From Coinbase Custody

Consequently, the JAN3 CEO strongly believes that with the stigma on Coinbase, spot Bitcoin ETF issuers might begin to consider adopting in-house custody or even migrate their BTC holdings to other custodians. 

That’s the problem with using a custodian like Coinbase. They didn’t invest much into their #Bitcoin infrastructure because they were too busy shitcoining. We’ll see some ETFs build in-house custody like @DigitalAssets, or migrate to other custodians in the next couple quarters. https://t.co/B2ioS1ayCx

— Samson Mow (@Excellion) January 24, 2024

Moreso, he also thinks that if these ETFs hit a certain Asset Under Management (AUM), they would opt for a Bitcoin-only custodian. In the meantime, it is not yet certain how his opinion of Coinbase Custody will influence the spot Bitcoin ETF issuer’s decision in the long term.

However, the broad Bitcoin ETF market has been performing relatively well compared to a few days ago when outflows were over the roof, especially from Grayscale. With BlackRock’s IBIT leading with 40,213 BTC, nine spot Bitcoin ETFs have accumulated over 100,000 BTC thus far, valued at over $4 billion. 

Grayscale is also trying to get back in the game after immense capital exodus and has therefore adopted a new marketing strategy to actualize this goal.