Bitcoin ETF updates<\/h4>
On March 17, 2025, Evolve Funds Group Inc. launched Canada\u2019s first levered exposure Bitcoin ETF (TSX: LBIT), which was designed to offer investors more exposure to Bitcoin\u2019s daily price movements (according to its US dollar price).<\/p><\/div><\/article>
Which companies are offering Bitcoin ETFs?<\/h3>
These companies offer Bitcoin ETFs:<\/p>
- Evolve<\/li>
- BlackRock<\/li>
- Fidelity<\/li>
- Invesco<\/li>
- Grayscale<\/li>
- ARK & 21 Shares<\/li>
- Bitwise Invest<\/li>
- Franklin<\/li>
- VanEck<\/li>
- WisdomTree<\/li>
- Valkyrie<\/li>
- Hashdex<\/li><\/ul>
What are Bitcoin spot ETFs?<\/h3>
Bitcoin ETFs (exchange-traded funds) allow you to get exposure to Bitcoin\u2019s price through traditional brokerages and in your retirement accounts. The option be able to invest in Bitcoin ETFs began on January 11, 2024, when the US Securities and Exchange Commission (SEC) approved 11 spot Bitcoin ETFs.<\/p>
Why buy a Bitcoin ETF?<\/h3>
A Bitcoin ETF allows investors to gain exposure to this volatile asset through a basket approach.<\/p>
It\u2019s like any other thematic-based ETF. If you believe a certain sector, theme or market could be the major winner moving forward but are unsure of the individual winners, taking a basket approach allows you to gain exposure while offsetting individual business risk.<\/p>
An ETF approach to Bitcoin also allows investors a different way to gain exposure.<\/p>
While there are many Bitcoin ETFs in circulation, many of which are inaccessible, the available ones offer investors different solutions. Some track movement in price while others follow businesses that are exposed to crypto assets. And while you should know what you own, a Bitcoin ETF could be a way of gaining access to the fastest-growing trend in financial markets.<\/p>
3 types of Bitcoin ETFs<\/h4>
Bitcoin ETFs all broadly follow the same theme, but they can be broken down into 3 main categories:<\/p>
- Physically backed. <\/b>This is probably the simplest form of ETF for investors to get their heads around. In this instance, the ETF you invest in will buy Bitcoin<\/a> on your behalf and store it for you, most often in an offline wallet.<\/li>
- Futures contracts. <\/b>If you choose to buy a futures-backed ETF, you don\u2019t actually own Bitcoin. Instead, the ETF provider is trading contracts that reflect Bitcoin\u2019s price on your behalf. Should the price of Bitcoin increase, so will the next contract, lifting the price of what the ETF holds. The inverse is also true should the price of Bitcoin fall.<\/li>
- Picks and shovels. <\/b>In this instance, you\u2019re looking at companies that are mining Bitcoin. You are investing in the underlying tech instead of the outcome. Basically, you\u2019re making money selling the picks and shovels instead of buying Bitcoin itself.<\/li><\/ol>
Cryptocurrency ETFs vs cryptocurrency: Benefits and risks<\/h3>
- Benefits of cryptocurrency ETFs<\/a><\/li>
- Risks of cryptocurrency ETFs<\/a><\/li><\/ul>
- Simplicity<\/strong>. Learning how to buy and store cryptocurrency can be a confusing and daunting process. ETFs make it easy to gain exposure to digital currencies without going through the hassle of owning any coins.<\/li>
- Create a diverse portfolio<\/strong>. The compartmentalized nature of the cryptocurrency industry means that acquiring and holding a large collection of currencies all at once is complicated and time-consuming. You may have to open several wallets and maintain accounts on multiple cryptocurrency exchanges. While US choices track only Bitcoin at the moment, in theory, cryptocurrency ETFs allow you to track multiple digital coins and tokens at once, saving you a lot of time and effort.<\/li>
- Avoid the risk of hacking<\/strong>. Cryptocurrency exchanges and wallets are susceptible to hacking attacks and theft. Buying units in a cryptocurrency ETF protects you against these risks as you don\u2019t actually own any digital coins.<\/li>
- Lower fees<\/strong>. ETFs generally have lower fees than traditional managed funds, making it possible to build a diversified portfolio at a lower expense.<\/li>
- Regulation.<\/strong> Futures markets used by current Bitcoin ETFs are federally regulated while Bitcoin has more limited regulation. Some will consider this a benefit, others a drawback.<\/li><\/ul><\/div>
- Limited choice<\/strong>. There\u2019s currently limited choice available for anyone wanting to invest in cryptocurrency-related ETFs in the US. However, now that the SEC has approved its first cryptocurrency ETF, this will likely soon change.<\/li>
- Volatility<\/strong>. Cryptocurrencies are famous for their volatility. They can also experience substantial price fluctuations in a short period. If the market moves against you, the value of your cryptocurrency ETF units could take a sharp dive.<\/li>
- Tracking vs owning<\/strong>. With futures-based cryptocurrency ETFs, you\u2019re also looking at a value that tracks the coin indirectly. It won\u2019t match the asset and you could gain or lose as the asset moves in price. It\u2019s a great unknown at this point.<\/li>
- Lack of risk diversification<\/strong>. Traditional ETFs often include an extensive range of securities to help achieve diversification. They sometimes include government bonds and debt to mitigate market risk. However, most versions of cryptocurrency ETFs only provide access to a limited range of digital currencies. When you consider the correlation between the performance of Bitcoin and the value of altcoins, this only increases the level of risk.<\/li>
- Crypto-specific risks still apply<\/strong>. Just because you don\u2019t have to deal with any of the risks of owning digital currency doesn\u2019t mean these risks cease to exist. Issues such as hacking will still need to be managed by the ETF provider.<\/li>
- Fees apply<\/strong>. On top of an annual management fee, you\u2019ll need to consider brokerage fees that apply when you buy or sell ETF units.<\/li>
- International taxes<\/strong>. If you buy ETF units located in another country, such as XBT Provider\u2019s funds, be aware that foreign tax may apply.<\/li><\/ul><\/div><\/div>
Compare online ETF brokers<\/h3>
To invest in Bitcoin ETFs, you need a brokerage account. Review platform features and fees to find the account that best fits your needs.<\/p>
\n\n <\/div>\n\n\n - Volatility<\/strong>. Cryptocurrencies are famous for their volatility. They can also experience substantial price fluctuations in a short period. If the market moves against you, the value of your cryptocurrency ETF units could take a sharp dive.<\/li>
- Create a diverse portfolio<\/strong>. The compartmentalized nature of the cryptocurrency industry means that acquiring and holding a large collection of currencies all at once is complicated and time-consuming. You may have to open several wallets and maintain accounts on multiple cryptocurrency exchanges. While US choices track only Bitcoin at the moment, in theory, cryptocurrency ETFs allow you to track multiple digital coins and tokens at once, saving you a lot of time and effort.<\/li>
- Risks of cryptocurrency ETFs<\/a><\/li><\/ul>
- Futures contracts. <\/b>If you choose to buy a futures-backed ETF, you don\u2019t actually own Bitcoin. Instead, the ETF provider is trading contracts that reflect Bitcoin\u2019s price on your behalf. Should the price of Bitcoin increase, so will the next contract, lifting the price of what the ETF holds. The inverse is also true should the price of Bitcoin fall.<\/li>
- Physically backed. <\/b>This is probably the simplest form of ETF for investors to get their heads around. In this instance, the ETF you invest in will buy Bitcoin<\/a> on your behalf and store it for you, most often in an offline wallet.<\/li>