Fintech
Eric Balknath, the go-to voice over funds trading on Bloomberg exchanges, was able to ignite one of the Crypto community’s favorite debates. Is ETF really a different version of a token?
With X’s active exchange, Balchunas Discussed ETFs have many of the same features that made accessibility, low fees and harvester tokens popular in the first place, but they have a layered layer of regulatory guardrails and customer support. His explanation as a “token with profits” sparked both support and criticism.
The timing of his comments is remarkable. ETF launches have accelerated at a record-breaking pace this year, with over 70 new funds arriving in a month. That momentum includes traditional investors who view ETFs as the safest bridge to digital assets, even though Crypto natives are bliss in comparison.
Members of the Cardano community quickly highlighted that the ecosystem is already hosting tokens with “additional features” by citing projects such as NMKR and FluidTokens. Others pushed back harder, noting that tokens exist within the framework of regulation, while being rooted in unauthorized code. One commenter asserted that “ETFs are laws wrapped in mathematics, and tokens are mathematics as law.”
Balchunas acknowledged that decentralization is important for Bitcoin, but downplayed the role of other blockchains. Critics rebutted by pointing out repeated failures of managers regulated during the financial crisis, claiming that the code provides stronger assurances than laws shaped by politics.
Ironically, the “token with profit” conversation unfolded, just as the crypto ETFs endured another bruise week. The Spot Bitcoin fund was led by a massive withdrawal from Fidelity’s FBTC and ARKB, which withdraws more than $100 million in a day. Ether products bleed further, with Fidelity’s Feth and Grayscale’s Mini Trust losing nearly $100 million in total. The sector’s total assets fell to approximately $147 billion.
Balchunas suggests that ETFs are positioned to achieve long-term adoption, even when short-term flows are unstable. But the arguments he ignites show a deeper gap. One side considers ETFs to be a mirror of safer and regulated tokens, while the other claims that true innovation lies in open and unstoppable codes.
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