Topic: Bitcoin price discovery

More and more #bitcoin is taken off exchanges, but nonetheless the crab market continues to keep poking bitcoiners in the eye.

I asked Grok:

"If we ignore bitcoin futures trading, is it possible that trading of "paper bitcoin" on crypto exchanges has such volume that it affects the bitcoin spot price?"

Grok's conclusive remarks were:

"The sentiment from posts on X and broader market analysis suggests that while spot ETFs and direct ownership of Bitcoin are significant, the derivatives market's volume and its impact on price cannot be understated. This indicates that even without considering futures, the trading volume of what might be colloquially termed "paper Bitcoin" on crypto exchanges could indeed affect the Bitcoin spot price through mechanisms like sentiment, arbitrage, and leveraged trading. However, the exact extent of this influence would require detailed market data analysis beyond what's typically available in public discussions or general insights from X posts."

Comments?

Excluding futures, can trading of "paper bitcoin" negatively affect bitcoin price discovery in theory or practice?
 

 Of course, it's the same thing with gold. BTC can be used and verified directly, but that's not widely understood yet. 

 I knewed it…those prix are screwing with us🤣🤣

I guess I’ll just console myself with the fact that there will only ever be 21 million btc and the amount of fiat required to suppress harder assets like precious metals and BTC will only hasten the demise of said fiat🤔💣

“BRING IT” central banks🤡🌎 

 Of course. We have seen it with the gold price post ETF as well as Monero post Binance listing (fractional reserves).

It's easy for them to do whatever they want as long as ETFs are cash settled and they control the printing press, while the general public still sees USD as valuable.

You will see prices rise when "they" want it to rise.

It's the reason the Monero community celebrated the delisting on centralised exchanges. Taking a short term liquidity hit for a long term gain. 

 Hopefully,  EFTs will open for in-kind settlements. It won't start with the US ETFs but others, with weaker fiat. That way they will make a better investment.