Best cryptocurrency ETFs to buy. ETFs are one of the simplest ways for investors to get diversified exposure to a specific asset class. In the early days of cryptocurrency, one of the most difficult aspects of investing in Bitcoin (BTC) and other cryptocurrencies was determining how and where to buy them. Cryptocurrency ETFs make investing in Bitcoin as simple as buying regular stocks. There are currently several cryptocurrency-themed ETFs available, and the number is growing. However, bear in mind that some ETFs may have significant management fees.
Here are the top 7 cryptocurrency exchange-traded funds (ETFs) with exposure to cryptocurrencies or crypto futures contracts.
1. ProShares Bitcoin Strategy ETF (BITO)
The ProShares Bitcoin Strategy ETF was the first cryptocurrency-focused ETF to be approved in the U.S., and it caused quite a stir. The performance of Bitcoin futures contracts is tracked by the ProShares Bitcoin Strategy ETF. The funds contain several Bitcoin futures contracts and have amassed more than $1.4 billion in assets under management just a month after being approved by the US Securities and Exchange Commission. The annual cost ratio of the BITO ETF is 0.95 percent or $95 for every $10,000 invested. As a result, it is now one of the top Bitcoin futures ETFs available to investors. As Bitcoin’s usage grows, BITO’s value will rise as more institutional investors seek access to bitcoin.
2. Grayscale Bitcoin Trust (GBTC)
The Grayscale Bitcoin Trust was the best Bitcoin fund option for most investors before the debut of the BITO ETF. The GBTC fund, which is a trust rather than an ETF, was established in 2013. When the SEC permits cryptocurrency spot ETFs that follow Bitcoin values directly, Grayscale plans to convert the GBTC trust to an ETF. GBTC, unlike other Bitcoin ETFs, contains genuine Bitcoin, with each share representing around 0.0009 Bitcoin. One of the largest and most liquid crypto funds, the GBTC trust, has $24.2 billion in assets and a 2% expense ratio.
3. Valkyrie Bitcoin Strategy ETF (BTF)
The Valkyrie Bitcoin Strategy ETF (BTF) is a Bitcoin futures ETF that was created just a few days after BITO was approved by the Securities and Exchange Commission. BTF is a stock that trades on the NASDAQ and, like BITO, does not invest directly in Bitcoin. Rather, BTF trades front-month Bitcoin futures on the Chicago Mercantile Exchange. BTF manages approximately $60 million in assets and has an expense ratio of 0.95 percent. Valkyrie wants to create other crypto-focused funds in the future, so this ETF is expected to gain even more traction among investors.
4. VanEck Bitcoin Strategy ETF (XBTF)
The VanEck Bitcoin Strategy ETF, which is ETF leader VanEck’s version of a Bitcoin fund, debuted on November 15, 2021. The XBTF fund invests in CME Bitcoin futures, and its main selling point is its 0.65% expense ratio, which is the lowest among the current class of Bitcoin futures funds. The ultimate goal of VanEck is to create a Bitcoin spot ETF, but the SEC rejected its petition just days after the XBTF fund started. In its spot fund denials, the SEC has often mentioned the possibility of fraud and market manipulation. The XBTF fund currently manages $22.1 million in assets.
5. Purpose Bitcoin ETF (BTCC)
While the United States has yet to approve a single Bitcoin ETF, Canada, its North American neighbor, has already done so. With over $1 billion in assets under management, the Purpose Bitcoin ETF (BTCC) is one of the world’s largest spot Bitcoin ETFs. The price of BTCC could rise in the future as more investors seek ETFs with direct exposure to Bitcoin, especially if the US continues to oppose the creation of similar funds.
6. Amplify Transformational Data Sharing ETF (BLOK)
Amplify Transformational Data Sharing ETF (BLOK) is a fund that invests nearly 80% of its total assets in stocks engaged in the development of blockchain technologies. BLOK does not track an index but instead focuses on numerous crypto value and growth stocks. MicroStrategy, PayPal, Coinbase, and Square are among BLOK’s top holdings. This fund has a 0.71 percent cost ratio, a 195 percent one-year return, and manages more than $1 billion in assets. Because the cryptocurrency industry is expected to grow in size over the coming months and years, BLOK’s value could rise from its present $59 per share if the underlying equities continue to perform well.
7. Global X Blockchain & Bitcoin Strategy ETF (BITS)
The Global X Blockchain & Bitcoin Strategy ETF, like many other cryptos ETFs, invests in Bitcoin futures contracts. However, the Global X Blockchain ETF (BKCH), holds a collection of 26 stocks of companies that benefit from the adoption of blockchain technology, including Coinbase Global Inc. (COIN), Riot Blockchain Inc. (RIOT), and Marathon Digital Holdings Inc., accounts for nearly half (47.7%) of the fund’s holdings (MARA). The BITS fund’s structure allows investors to invest in Bitcoin in a more diversified fashion than pure-play Bitcoin futures funds. The BITS fund was established on November 16, 2021, and it currently has $6.2 million in assets.