What will this mean for bitcoin? Will the ETF be investing the bitcoins it purchases? Or will this just mean more transfers that steadily increase the value of accounts that never make any debits?
It's difficult to invest Bitcoins since the expected rate of return of holding them exceeds the rate of return of almost all legitimate businesses. Although I haven't read the registration document, the idea of an ETF is to simply hold the underlying asset and pass through its appreciation to investors.
They'll be purchasing and (and most likely) holding Bitcoin for prolonged periods