Switching from IBIT to FBTC is like two kids endlessly trading the exact same Bitcoin IOU back and forth, but the actual Bitcoin never leaves Coinbase Custody’s vault.
- Kid A sells his “BlackRock Bitcoin IOU” and uses the dollars to buy Kid B’s “Fidelity Bitcoin IOU.”
- Both IOUs are backed 1-to-1 by the very same stack of Bitcoin sitting untouched in a Coinbase cold wallet.
- No Bitcoin is ever handed from BlackRock to Fidelity.
- No Bitcoin is handed from Fidelity to BlackRock.
- Coinbase Custody doesn’t move a single satoshi between segregated client wallets — why would they? Net exposure for the entire system hasn’t changed by one atom.
- The Bitcoin ledger (the real blockchain) never nothing, zero transactions, zero fees, zero anything. Dead silence. 🔕
Yet the price on every exchange, every Bloomberg terminal, every ETF ticker jumps around like crazy because millions of kids (institutions, retail, algos) are frantically swapping these IOUs on a regulated playground called the stock market.
The actual Bitcoin never moved as much as a brick in a bank vault moves when you swap a BlackRock vault receipt for a Fidelity vault receipt.
There was no tree in the woods that fell, so of course it didn’t make noise.
The only thing that made noise was a bunch of tourists trading colored paper claims while the real Bitcoin sat there, perfectly silent.