Top 10 Bitcoin ETFs Available in the Stock Market
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Bitcoin Exchange-Traded Funds (ETFs) have become a popular investment tool for those looking to gain exposure to Bitcoin without the need to directly purchase or manage the cryptocurrency. Bitcoin ETFs allow investors to trade Bitcoin like a regular stock on major exchanges, making it easier to integrate Bitcoin into traditional investment portfolios.
This article explores the top 10 Bitcoin ETFs available in the stock market, providing a comprehensive overview of their features, benefits, and how they differ from one another.
1. ProShares Bitcoin Strategy ETF (BITO)
Launch Date: October 18, 2021
Focus: Bitcoin Futures
Overview: BITO was the first Bitcoin futures ETF to launch in the United States and is one of the most well-known in the market. Unlike traditional ETFs that hold physical Bitcoin, BITO invests in Bitcoin futures contracts traded on the Chicago Mercantile Exchange (CME). This means that BITO provides indirect exposure to Bitcoin’s price movements, as the fund does not own Bitcoin directly.
Benefits: BITO offers investors the ability to gain Bitcoin exposure through traditional brokerage accounts without having to manage wallets or keys. However, as it invests in futures contracts, it is subject to the risks and costs associated with futures trading.
Expense Ratio: 0.95%
2. Valkyrie Bitcoin Strategy ETF (BTF)
Launch Date: October 22, 2021
Focus: Bitcoin Futures
Overview: BTF is another Bitcoin futures ETF, offering similar exposure to Bitcoin’s price movements as BITO. The fund primarily invests in Bitcoin futures contracts traded on the CME, allowing investors to gain indirect exposure to Bitcoin’s market fluctuations.
Benefits: BTF is managed by Valkyrie Investments, a firm with deep expertise in cryptocurrency and digital assets. Like BITO, BTF allows for easy access to Bitcoin via traditional brokerage accounts.
Expense Ratio: 0.95%
3. VanEck Bitcoin Strategy ETF (XBTF)
Launch Date: November 2021
Focus: Bitcoin Futures
Overview: XBTF is another major Bitcoin futures ETF launched by VanEck, one of the leading asset management firms in the cryptocurrency space. The ETF seeks to track the performance of Bitcoin through exposure to Bitcoin futures contracts.
Benefits: XBTF offers investors a lower expense ratio compared to some of its competitors in the Bitcoin futures space. As with other Bitcoin futures ETFs, it doesn’t provide direct ownership of Bitcoin but offers a convenient method of exposure through traditional stock markets.
Expense Ratio: 0.65%
4. ProShares Short Bitcoin Strategy ETF (BITI)
Launch Date: June 2022
Focus: Short Bitcoin Futures
Overview: BITI is a unique Bitcoin ETF that aims to provide inverse exposure to the price of Bitcoin. By investing in short Bitcoin futures contracts, BITI allows investors to profit from Bitcoin’s price decline, making it an attractive option for those looking to hedge against a bear market or those with a bearish outlook on Bitcoin.
Benefits: BITI is a valuable tool for traders who believe that Bitcoin’s price will decrease, allowing them to bet against the asset without directly shorting it. However, this ETF is more suited for short-term traders due to the complexities of managing inverse funds.
Expense Ratio: 0.95%
5. Grayscale Bitcoin Trust (GBTC)
Launch Date: September 2013
Focus: Bitcoin (Direct Exposure)
Overview: While not technically an ETF, the Grayscale Bitcoin Trust (GBTC) is a popular investment vehicle that functions similarly to an ETF, offering exposure to Bitcoin by directly holding the digital asset. Investors in GBTC own shares in the trust, which holds Bitcoin on behalf of shareholders.
Benefits: GBTC is one of the oldest and most established vehicles for Bitcoin exposure in the U.S. market. Unlike Bitcoin futures ETFs, GBTC provides direct exposure to the price movements of Bitcoin, which is appealing to many investors. However, the trust has historically traded at a premium or discount to the underlying Bitcoin price.
Expense Ratio: 2.0%
6. ProShares Bitcoin ETF (BTFD)
Launch Date: Not yet available
Focus: Bitcoin (Direct Exposure)
Overview: ProShares has been active in the Bitcoin ETF space with a series of Bitcoin-related products. While BTFD has not launched yet, it’s a potential ETF that could offer direct exposure to Bitcoin by holding physical Bitcoin, making it an ideal choice for those seeking direct access to the asset.
Benefits: Direct exposure to Bitcoin would reduce the risks associated with futures-based ETFs, such as contango (when futures prices are higher than the spot price of Bitcoin). However, its launch depends on regulatory approval from the U.S. Securities and Exchange Commission (SEC).
Expense Ratio: TBD
7. Invesco Bitcoin Strategy ETF (BITA)
Launch Date: Pending SEC approval
Focus: Bitcoin Futures
Overview: BITA is another Bitcoin futures ETF under development by Invesco, one of the world’s largest investment management firms. The fund will track Bitcoin’s performance through futures contracts, offering indirect exposure to the cryptocurrency.
Benefits: Invesco’s track record in managing exchange-traded products adds credibility to BITA’s potential. If approved, it will offer investors another avenue for accessing Bitcoin exposure via traditional brokerage accounts.
Expense Ratio: TBD
8. Global X Blockchain & Bitcoin Strategy ETF (BITS)
Launch Date: November 2021
Focus: Bitcoin Futures and Blockchain Stocks
Overview: Unlike traditional Bitcoin ETFs, BITS offers a more diversified exposure by investing in both Bitcoin futures contracts and blockchain-related companies. This ETF provides investors with exposure to the broader blockchain ecosystem, including companies that are involved in the development and adoption of blockchain technology.
Benefits: BITS is an excellent choice for investors looking for a diversified Bitcoin and blockchain investment vehicle, providing exposure to both Bitcoin price movements and companies advancing blockchain technology.
Expense Ratio: 0.68%
9. Bitwise 10 Crypto Index Fund (BITW)
Launch Date: December 2020
Focus: Cryptocurrency (Bitcoin and others)
Overview: BITW is a cryptocurrency index fund that includes Bitcoin as one of its largest holdings, along with other major cryptocurrencies such as Ethereum. Although not purely focused on Bitcoin, it offers investors exposure to a broad range of cryptocurrencies, with Bitcoin comprising a significant portion of the fund.
Benefits: BITW provides a way to gain exposure to the entire cryptocurrency market, which may appeal to investors seeking a more diversified crypto investment. The fund is also passively managed, which helps reduce management fees.
Expense Ratio: 2.5%
10. 21Shares Bitcoin ETP (ABTC)
Launch Date: 2019
Focus: Bitcoin (Direct Exposure)
Overview: The 21Shares Bitcoin ETP is a European exchange-traded product that offers direct exposure to Bitcoin by physically backing its shares with actual Bitcoin. ABTC is available on the Swiss SIX Exchange and other European exchanges.
Benefits: This ETP offers direct exposure to Bitcoin, eliminating the complexities associated with futures markets. It’s ideal for European investors who prefer a straightforward and efficient way to invest in Bitcoin.
Expense Ratio: 1.49%
Conclusion
Bitcoin ETFs are increasingly popular investment tools for those looking to participate in the cryptocurrency market without directly owning Bitcoin. These funds allow investors to gain exposure to Bitcoin’s price movements through traditional stock markets, each offering different strategies—ranging from Bitcoin futures contracts to direct ownership of the cryptocurrency. As the regulatory landscape continues to evolve, more Bitcoin ETFs may emerge, making it easier for investors to gain access to this revolutionary asset class.
