Of the 11 financial institutions that issued spot Bitcoin ETFs in January 2024, only two \u2014 Bitwise and VanEck \u2014 have pledged to donate a percentage of their profits to open-source Bitcoin development.<\/p>\n

Regardless of whether large holders are harassing ETF sponsors for funding core dev, the real question is – why are only @BitwiseInvest<\/a> and @vaneck_us<\/a> doing so? Bitcoin is an ongoing project and core dev continues to be underfunded<\/p>\n

\u2014 nic “bankful” carter (@nic__carter) April 10, 2024<\/a><\/p>\n

In considering the logic behind Bitwise and VanEck\u2019s decision to donate to developers who maintain and update the Bitcoin protocol, it\u2019s difficult to imagine why more spot Bitcoin ETF issuers haven\u2019t followed suit.<\/p>\n

\u201cWhile we use the language of \u2018donation\u2019 when we support devs, I think in reality it’s closer to a self-investment into making the asset itself stronger,\u201d Hong Kim, co-founder and CTO of Bitwise, wrote in an AMA thread on Stacker News<\/a>. \u201cMany 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?\u201d<\/p>\n

For this reason, Bitwise, which issued its spot Bitcoin ETF under the name Bitwise Bitcoin ETF<\/a> (ticker: BITB), committed to donating 10% of its ETF fee profits to three different nonprofits that fund Bitcoin Core developers \u2014 OpenSats<\/a>, Brink<\/a> and the Human Rights Foundation (HRF)<\/a> \u2014 for 10 years.<\/p>\n

\u201cBrink, OpenSats and HRF were the most established nonprofits with a track record of funding Bitcoin devs \u2014 they had the proof of work, so to speak,\u201d Kim told Bitcoin Magazine.<\/p>\n

VanEck, which issued its spot Bitcoin ETF under the name VanEck Bitcoin Trust<\/a> (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<\/a> to the organization.<\/p>\n

\u201cWe believe TradFi stands to gain from the efforts of Bitcoin’s Core contributors,\u201d Matthew Sigel, Head of Digital Asset Research at VanEck, told Bitcoin Magazine.<\/p>\n

\u201cAs we stand to profit from Bitcoin\u2019s price increase, it makes sense that we also give back to the work of the innovators who make the chain possible,\u201d he added.<\/p>\n

Given that it\u2019s only sensible for spot Bitcoin ETF issuers to give back Bitcoin Core developers \u2014 those who support and further the underlying asset for their financial product \u2014 which will be next to follow Bitwise and VanEck\u2019s lead?<\/p>\n

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.<\/p>","protected":false},"excerpt":{"rendered":"

Of the 11 financial institutions that issued spot Bitcoin ETFs in January 2024, only two \u2014 Bitwise and VanEck \u2014 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 […]<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-24589","post","type-post","status-publish","format-standard","hentry","category-crypto-news"],"_links":{"self":[{"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/posts\/24589","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/comments?post=24589"}],"version-history":[{"count":0,"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/posts\/24589\/revisions"}],"wp:attachment":[{"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/media?parent=24589"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/categories?post=24589"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bitcoins-101.com\/wp-json\/wp\/v2\/tags?post=24589"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}