The second is broader, and is a liquidity issue. If there is a run on these funds in the event of a stock market downturn I can see them adding to liquidity pressure as they effectively leverage the underlying assets by double quoting them. This could ratchet a downturn in market sentiment and add to instability, effectively reflecting the burst of a double bubble. Anything that can do that is dangerous. The fact that ETFs have had a good track record simply says they have reflected the market recovery (as opposed to the real market recovery) from 2008. Nothing suggests that they add real value, and I strongly suspect that in a period of instability they would do the exact opposite.
There are leveraged ETF’s most certainly, but the definition of an ETF doesn’t imply leverage at all. Consider and ETF which says it is invested in BP and Shell, tracking those two stocks. It will buy 100 Shell, 100 BP, (ignore weighting here) and then issue 200 ETF shares, each of which is half a BP share and half a Shell share. If more people want to buy hte ETF then they buy more Shell and BP shares, if more people want to sell then they sell hunks of stock.
This isn’t leverage. No more of the asset is created than existed before the ETF.
Liquidity can indeed be a problem, a those running open ended funds in commercial property have found out but that’s a different matter.