This isn't entirely true. A physically backed bitcoin ETF will certainly help drive the price of bitcoin higher as it buys up bitcoins to back it's shares initially. However, once the ETF actually launches it won't have as much of an impact on prices because the shares will be traded instead of the actual asset. At that point, the ETF price pretty much FOLLOWS the price of the asset instead of SETTING it. Also, once one physically backed ETF is approved, many more will try to launch and they will all need to buy up an inventory as well, which will also spur demand. The ETF will also likely open the market up to many more participants which likely is a net positive. So, while you are mostly right, there is still a caveat. :)