Cryptocurrencies have become one of the most prominent tools to transform the domain of financial services. With the power of blockchain, cryptocurrencies not only provide the foundation for new types of financial transactions but also bring many advantages along with them. However, cryptocurrencies are not accessible to everyone, as the average person could have multiple apprehensions regarding the technical aspects of cryptocurrencies. If you are seeking information about the best cryptocurrency ETF in the market, then you have arrived at the right place. Cryptocurrency ETFs or exchange-traded funds are one of the most promising answers to people’s doubts about investment in cryptocurrencies. Crypto ETFs work by tracking the price performance of one or multiple cryptocurrencies through investment in a portfolio associated with the related instruments. Let us find out more about the importance of crypto ETFs and the top cryptocurrency ETFs available in the market.
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Why Have Crypto ETFs Gained Popularity?
Cryptocurrency ETFs have offered investors an opportunity to participate in a continuously expanding list of commodities and market segments. The cryptocurrency ETF list is growing bigger and is expected to grow further with the regulatory approval for crypto ETFs by the Securities and Exchange Commission. Retail investors could leverage crypto ETFs to find direct exposure to the crypto market without having direct ownership of assets. Crypto ETFs work through two distinct ways for tracking the performance of cryptocurrencies, such as spot ETFs and futures contracts ETFs.
Spot ETFs work by holding direct ownership of the cryptocurrency with a portfolio that offers natural replication of the performance of digital assets. Futures contracts ETFs work with agreements that support purchasing and selling cryptocurrencies at a predetermined price and date. The search for the top crypto ETF would require an overview of the structure of portfolios in ETFs. The ETFs track the variations in prices of derivatives rather than the cryptocurrencies. Just like other ETFs, crypto ETFs have different variations in pricing.
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Should You Choose Crypto ETFs?
Before finding out the most popular crypto ETF, it is important to solve all your doubts regarding cryptocurrency ETFs. Crypto ETFs are the right options for anyone who is interested in the potential of cryptocurrencies. ETFs can help avoid the concerns of volatility in cryptocurrency pricing and multiple scams that lead to hesitation.
Crypto ETFs serve as a regulated and conventional approach to investing in cryptocurrencies. Cryptocurrency ETFs are traded on the established stock markets and involve the expertise of professional fund managers. You can find the responses to “What are the best cryptocurrency ETFs?” by looking for advantages of stability and reassurance that are not available with direct crypto investments. Crypto ETFs are suitable for traditional investors who seek a diversified portfolio. Different types of crypto ETFs would help in tracking a pool of different cryptocurrencies apart from giants such as Ether and Bitcoin. Therefore, ETFs can provide broader exposure in the crypto market with the advantage of risk management.
The US Securities and Exchange Commission also helps regulate crypto ETFs with better clarity. Anyone who prefers passive investment strategies would perceive crypto ETFs as the ideal fit for their investment plans.
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Most Popular Cryptocurrency ETFs in 2024
The reasons for investing in crypto ETFs show that they are the perfect choices for traditional investors. Cryptocurrency ETFs can serve as a better option than purchasing spot Bitcoin and other crypto assets. The search for the best cryptocurrency ETF might require you to browse through the different entries in the market. It is also important to review the key holdings in the ETFs and the net value of assets under each fund.
Valkyrie Bitcoin Strategy ETF
The Valkyrie Bitcoin Strategy ETF, or BTF, was launched in October 2021 and has gained popularity at an impressive pace within a limited time. It is an actively managed fund, and its primary objective revolves around spending almost 100% of its net assets on Bitcoin futures contracts. It serves as a top entry in the cryptocurrency ETF list that focuses beyond Bitcoin derivatives. The remaining assets in the BTF are centered in US government securities, corporate bonds, and money market funds. Just like other crypto ETFs, BTF works by investing largely in Bitcoin futures, thereby offering an easily accessible way to obtain exposure to Bitcoin price movements without direct ownership of the cryptocurrency.
In simple words, the working of Valkyrie Bitcoin Strategy ETF involves a team of professional traders swing trading through the peaks and troughs of Bitcoin on your behalf. With almost $32 million in terms of net asset value, the BTF includes assets such as Bitcoin, cash in USD, and United States Treasury Bills.
Amplify Transformational Data Sharing ETF or BLOK
Amplify ETFs or Amplify Transformational Data Sharing ETF is another top name among cryptocurrency ETFs. It is also known as BLOK and has become the top crypto ETF in the market right now for obtaining exposure to companies that are actively involved in the development of blockchain technologies. BLOK does not invest directly in cryptocurrencies but also focuses on companies that are supporting the blockchain revolution. It invests in crypto industry giants such as MicroStrategy by Michael Saylor, which is the largest public company with Bitcoin assets, and Coinbase.
Tech giants working in the domain of blockchain research, as well as startups who have a disruptive impact on industries through innovative blockchain applications, are associated with BLOK. It offers a diversified portfolio to capture the potential of the transformative technology. BLOK is the most popular crypto ETF with a net asset value of almost $581 million. Some of the key assets under the management of BLOK ETF include Microstrategy, Marathon Digital Holdings, and Coinbase.
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Siren Nasdaq NexGen Economy ETF or BLCN
The next noticeable addition among the most popular cryptocurrency ETFs in the market right now is Siren NFTs. Siren NASDAQ NexGen Economy ETF or BLCN is a unique answer to “What are the best cryptocurrency ETFs?” with similarities to Amplify ETFs. BLCN also invests in companies that are dedicated to the development, research, support, innovation, and use of blockchain technology.
The Siren NASDAQ NexGen Economy ETFs have holdings that span different sectors, such as communication services, technology, and finance. It can offer a diversified approach to blockchain investment and serves as an effective choice for investors interested in the transformative potential of blockchain. BLCN has a net asset value of almost $78 million and includes assets such as Microstrategy, Samsung Electronics, Coinbase, and Block Inc.
Bitwise 10 Crypto Index Fund or BITW
Another notable addition among the best crypto ETFs is Bitwise 10 Crypto Index Fund or BITW. It is the best cryptocurrency ETF for investors interested in the complexities of traditional markets. The approach for betting on traditional companies working in the blockchain industry is one aspect of the picture. However, direct investment in cryptocurrency is the actual playground. The ETF has formidable potential for people seeking a broader exposure to crypto markets.
BITW works by tracking the performance of the Bitwise 10 Large Cap Crypto Index. It is a basket that includes the ten largest cryptocurrencies in terms of market capitalization. Some of the notable holdings in the fund include big names such as Ether and Bitcoin alongside smaller yet promising players in the domain of cryptocurrencies. Investment in BITW focuses primarily on purchasing a share of the top tier in the crypto market with extensive diversification. BITW is an effective choice for investors interested in the long-term potential of cryptocurrencies. The net value of assets in the BITW holdings is $100 million, and some of the notable assets in the BITW portfolio include Bitcoin, Cardano, Ethereum, and Solana.
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Proshares Bitcoin Strategy ETF or BITO
Proshares Bitcoin Strategy ETF or BITO is one of the most popular and oldest crypto ETFs on Wall Street. According to Proshares’ claims, BITO is the world’s biggest ETF associated with ETF. It is a traditional entry in the cryptocurrency ETF list with more than $1 billion in terms of net asset value. BITO fund also offers monthly dividend payments alongside a low expense ratio measuring 0.95%. It is a reliable and popular choice for investors seeking options to find entry into the volatile waters of crypto.
The Proshares Bitcoin Strategy ETF or BITO fund has also attracted the attention of experienced investors. Cathie Wood, the CEO of Ark Invest, announced in December 2023 that she acquired a BITO allocation at a value of almost $92 million. Investors can gain exposure to prominent assets in the BITO portfolio, such as the United States Treasury Bills and Bitcoin Futures Contracts.
Bitwise Crypto Industry Innovators ETF or BITQ
The majority of the additions in the list of crypto ETFs emphasize Bitcoin futures contracts. It is the most popular crypto ETF that offers a slightly different perspective on the working of ETFs. The BITQ fund works through investment in crypto companies and stocks, which expose investors to the blockchain industry. At the same time, the fund also prevents the hassles associated with direct management of digital assets.
BITQ is a relative newcomer to the domain of crypto ETFs and was introduced in May 2021. It also ensures a low expense ratio that could be almost 0.85%. The fund has gained significant popularity among Wall Street investors by garnering their interest. The interest of investors in the BITQ fund led to a prompt surge in the net value to more than $140 million. Some of the prominent assets in the BITQ fund include BitFarms, Marathon Digital Holdings, Coinbase Global, and Microstrategy.
VanEck Bitcoin Strategy ETF
The list of best crypto ETFs in the market also includes VanEck Bitcoin Strategy ETF or XBTF fund. It is the top crypto ETF that offers direct exposure to Bitcoin without the hassles of buying Bitcoin through crypto exchanges. The XBTF fund works by primarily investing in Bitcoin futures contracts. As a result, it can closely track and monitor the performance of the most popular cryptocurrency in the world.
One of the most popular asset management firms, VanEck, takes care of the management of the XBTF fund. VanEck’s reputation for developing innovative investment products adds credibility to the VanEck Bitcoin Strategy ETF. XBTF is an effective choice for investors who have bullish sentiments about Bitcoin and want to make the most of its potential upsides. At the same time, it can also offer the benefits of operational efficiency and risk management associated with the ETF structure. Some of the prominent assets under the management of the XBTF fund include Bitcoin futures contracts and United States Treasury Bills.
Global X Blockchain & Bitcoin Strategy ETF or BITS
The Global X Blockchain & Bitcoin Strategy ETF or BITS fund is a hybrid ETF that offers exposure to Bitcoin and the blockchain industry. BITS emerges as the top answer to “What are the best cryptocurrency ETFs?” as it also includes holdings of hardware manufacturers as well as software developers. Apart from the companies in the blockchain industry, it also offers Bitcoin futures ETF. It means that it allocates a share of its assets to Bitcoin futures contracts.
The dual strategy for exposure ensures that the BITS fund is a unique addition to the crypto ETF space. It works as a suitable pick for investors who seek a combination of Bitcoin and blockchain exposure. The issuer also provides the Global X Blockchain ETF that does not have exposure to Bitcoin futures. The net value of assets in the BITS fund is $15 million and serves a unique approach towards ETF utility.
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Final Words
The best cryptocurrency ETF collection showcases some of the best options that can help you gain exposure to cryptocurrencies. Retail investors can find the advantage of better accessibility of cryptocurrencies with ETFs. On top of it, regulatory approval for crypto ETFs also opens the roads for broader adoption of crypto ETFs. However, it is important to complete your due diligence before choosing crypto ETFs. You must check different aspects of the ETFs, such as the assets they hold and the managers of the fund. Learn more about the top cryptocurrency ETFs and their working mechanisms. Find how they can help you gain exposure to the world of cryptocurrencies now.
*Disclaimer: The article should not be taken as, and is not intended to provide any investment advice. Claims made in this article do not constitute investment advice and should not be taken as such. 101 Blockchains shall not be responsible for any loss sustained by any person who relies on this article. Do your own research!
