What Bitcoin ETFs are currently available for investors to choose from?

Bitcoin exchange-traded funds (ETFs) offer investors a convenient and regulated way to gain exposure to the cryptocurrency market without the direct ownership and storage requirements.

Oct 24, 2024 at 08:25 pm

Bitcoin ETFs: A Comprehensive Guide

1. Overview

Bitcoin exchange-traded funds (ETFs) provide investors with exposure to the price movements of Bitcoin without the need for direct ownership or storage. These ETFs offer an accessible and regulated way to invest in the cryptocurrency market.

2. Available Bitcoin ETFs

As of February 2023, the following Bitcoin ETFs are available for trading in the United States:

• ProShares Bitcoin Strategy ETF (BITO)
• VanEck Bitcoin Strategy ETF (XBTF)
• Grayscale Bitcoin Trust (GBTC)

3. ProShares Bitcoin Strategy ETF (BITO)

• Launch Date: October 19, 2021
• Ticker: BITO
• Expense Ratio: 0.95%
• Features: A physically backed ETF that invests in actual Bitcoin futures contracts.

4. VanEck Bitcoin Strategy ETF (XBTF)

• Launch Date: November 15, 2021
• Ticker: XBTF
• Expense Ratio: 0.95%
• Features: Also physically backed, but invests in a broader universe of Bitcoin futures contracts, including those traded over longer durations.

5. Grayscale Bitcoin Trust (GBTC)

• Launch Date: October 2013
• Ticker: GBTC
• Expense Ratio: 2.00%
• Features: A closed-end trust that holds Bitcoin directly. GBTC trades over-the-counter (OTC) and is not physically backed by Bitcoin futures.

6. Key Differences

The main differences between these Bitcoin ETFs lie in their underlying assets, expense ratios, and trading mechanisms. BITO and XBTF are physically backed, which means they hold actual Bitcoin futures contracts. GBTC, on the other hand, holds Bitcoin directly. Additionally, GBTC trades OTC, while BITO and XBTF trade on exchanges.

7. Risks and Considerations

Investing in Bitcoin ETFs involves risks similar to investing in Bitcoin itself. These include price volatility, regulatory uncertainty, and the potential for fraud or manipulation. It is important to carefully consider these risks before investing.