"In turn, financial investors get a secure, levered exposure to bitcoin that is not hostage to an unproven price-setting and without the expense of setting up a system to hold physical bitcoin."
I realize that securely holding bitcoin at scale isn't completely trivial, but isn't part of the value of bitcoin supposed to be that these costs are not large? Especially the use of the term, "physical bitcoin," seems a bit ridiculous.
Bitcoin security is partly based on public-key crypto. So anything you would do to secure a private key, you can use to secure your BTC from being stolen. Encrypt it with a passphrase, or store it on a thumb drive and lock it in a safe, or print it out on paper and put it in your wallet to be scanned (e.g. in QR code format) only when needed, or even store it in a tamper-proof hardware dongle.
Plus the programmability features of Bitcoin open up some other interesting possibilities -such as setup multi-signature wallets each in a different physical location.
I realize that securely holding bitcoin at scale isn't completely trivial, but isn't part of the value of bitcoin supposed to be that these costs are not large? Especially the use of the term, "physical bitcoin," seems a bit ridiculous.