One of the main crypto narratives this year has been the approval and trading of U.S. spot Exchange Traded Funds (ETFs). They have been a resounding success. Not only have the bitcoin ETFs attracted $16 billion of inflows in half a year, the price of bitcoin (and therefore the prices of these ETFs) has increased by 46%.

The ETFs' success is so obvious that BlackRock’s CEO Larry Fink came out and said he likes bitcoin now (and not just because it can make his firm money!). In a recent interview with CNBC, Fink said, “My opinion five years ago was wrong. I believe bitcoin is a legitimate financial instrument.”

To be sure, the assets under management (AUM) attributable to IBIT, BlackRock’s Spot Bitcoin ETF, remains miniscule in the face of BlackRock’s total AUM (if you take out the AUM of IBIT – $18 billion – from BlackRock’s total AUM of $10.6 trillion, you’re still left with $10.6 trillion). Still, Fink's comment further legitimizes bitcoin in the eyes of the Boomer financial advisors now that firms like BlackRock and Fidelity (still waiting on Vanguard) bless bitcoin as a legitimate asset with a place in portfolios.

So Bitcoin, at least in this way, is here to stay.

What about what’s next? Well, an ether spot ETF, of course, which may begin trading next week and is also expected to be a success (albeit on a smaller scale than the Bitcoin ETF).

And then after that? Well, Solana ETFs naturally.

Over a billion, 300 million, trillion, 300 million ETFs

While I still personally maintain that bitcoin is different from other cryptocurrencies and is the only one which concretely does what it sets out to do, I think it is (and was) a significant mistake to assume bitcoin was in any way special in the eyes of high finance and Wall Street and, by extension, ETF issuers.

The U.S. ETF market is immense. Check the statistics from the Investment Company Institute for 2023: $8 trillion of assets; 218 firms providing ETFs; 3,108 total ETFs! And with good reason. ETFs make it trivial to compose your portfolio according to whatever investment thesis you may have.

For example, if you wanted to invest in healthcare or consumer discretionary goods there are sector ETFs for that. Say you’re young and want to chuck most of your portfolio into the tech-heavy Nasdaq-100. Just buy up a bunch of Invesco’s ETF QQQ, which tracks that. Whatever the idea, there’s an ETF for that.

They even have ETFs for more amusing, potentially farcical, ideas.

Say you’re young and want to chuck most of your portfolio into the Nasdaq-100, but also you want to get rich three times as fast. You can buy TQQQ, which is the same as QQQ but it goes up (and down) three times as fast (this is achieved through debt, or leverage, hence the term “triple levered ETFs”).

What if you want to buy an ETF even Jesus would like? Try WWJD. Do you see the virtue in vice and want to invest in worldly sins? Try VICE. What if you totally hate the investment advice of CNBC’s Jim Cramer? Try SJIM, the Inverse Cramer ETF, which follows the exact opposite of Cramer’s advice (not for nothing, this ETF no longer exists, but it used to!).

With this in mind, it’s plain that it wasn’t ever going to be “the Bitcoin ETF is the only ETF that will exist because bitcoin is better than the others and the SEC knows this.”

Two years ago I wrote:

“If the SEC decided tomorrow that bitcoin was a security, it would change nothing about bitcoin fundamentally. It would also change nothing about bitcoin market manipulation being bad. It would just change who thinks they can regulate it at this particular moment.”

Philosophically, it didn’t matter if cryptos were securities then, and it doesn’t matter now. So now the Bitcoin spot ETF has come to the U.S. and next comes one for Ethereum and then the next one and the next and the next until we finally stop and ask ourselves: What exactly is stopping the potential issuance of a meme coin ETF? Before you answer: “meme coins are securities,” remember that plenty of ETFs have securities in them (QQQ, TQQQ, WWJD, VICE).

As long as regulators are allowing new, shiny crypto ETFs, then the firms which provide ETFs will continue to provide them to the market because that’s what ETF providers do for a living. They make ETFs, investors buy them, and providers make a fee for managing them.

Even though it seems now that if it looks like a duck and quacks like a duck, it will be stuffed à la turducken into an ETF, I do believe that cooler heads will (eventually) prevail, among investors and/or regulators. Even if it takes a Duckley ETF for that to happen.

Note: The views expressed in this column are those of the author and do not necessarily reflect those of CoinDesk, Inc. or its owners and affiliates.