Investing in cryptocurrency isn’t just about Bitcoin and other tokens. It’s also about investing in ETFs! At Tokize, we pride ourselves on being investment-savvy. This is an innovative and effective way to get started in the field. While limiting risk thanks to the diversification this method offers. In the following text, we present you with absolutely everything you need to know about the best crypto ETFs. This list of crypto ETFs does not, however, constitute investment advice. Do your own research to make sure you’re on the right track.
With the monumental approval from the Securities and Exchange Commission in January of 2024, BTC ETFs have seen a corresponding surge in enthusiasm and attention. Since then, the price of most major cryptocurrences have grown substantially. We are still living with the after-effects of the decision to allow more investors to participate in the crypto market.
What is a Crypto Currency ETF?
ETFs (short for exchange-traded funds) are exchange-traded funds that track a specific index. Investing in an ETF is, in effect, investing in a group of assets that you can add to, strengthen, or sell whenever you feel the need or desire.
But in concrete terms, what are the advantages of a crypto ETF? Crypto ETFs work like conventional ETFs except that the targeted indices are companies specializing in the crypto-currency field. This offers a number of advantages:
- Diversification: Investing in a crypto ETF allows you to invest in a variety of quality companies and projects.
- Spreading risk: Diversifying your assets limits risk, particularly in the event of a market downturn.
- Reduced costs: Investing in a crypto ETF also reduces the costs associated with purchase and resale fees and stock trading.
- Returns: Generally speaking, crypto ETFs offer attractive returns, especially over the long term
The Limits of Crypto ETFs
Despite its various advantages, investing in crypto ETFs can have its limitations. Most ETFs available on the market only offer exposure to the most popular cryptocurrencies, notably Bitcoin. This choice is explained by the larger target that can be reached in this way, but it doesn’t allow investors to fully exploit the potential of the huge market that cryptocurrencies represent. If you want to invest in innovative projects, for example, but also in more stable currencies at the same time, crypto ETFs are not necessarily the ideal solution.
Moreover, this is a financing option that requires patience and time to generate attractive profits. Last but not least, crypto ETFs are not financial assets that can be included in your Equity Savings Plan passbook. You won’t therefore be able to integrate them into your traditional tax-exempt savings.
What Are the Best Crypto ETFs?
Crypto ETFs are a dime a dozen. In the rest of this article, we present a crypto ETF list of the 10 best-performing.
These ETFs are mostly based on crypto futures contracts since the US authorities have not yet approved ETFs based on real crypto assets.
1. ProShares Bitcoin Strategy ETF (BITO)
The first crypto ETF in our listing is the ProShares Bitcoin Strategy ETF. Why? Historically, it was the very first crypto ETF to be accepted in the USA. It began trading on the markets as early as October 2021.
What makes it special? BITO does not invest directly in cryptocurrencies (notably Bitcoin). Instead, the fund aims to provide returns through exposure to bitcoin futures. Many now see it as a substitute for real assets such as gold and other commodities.
2. Bitwise ETF
The second crypto EFT is the Bitwise Crypto Industry Innovators ETF (BITQ). The latter tracks the performance of the Bitwise Crypto Innovators 30 Index, an index comprising 30 stocks of “classic” companies. But which are directly involved in the cryptocurrency sector.
These companies vary in nature. There are mining specialists, mining equipment suppliers, and companies specializing in financial services. Recently, the company held major positions in Michael Saylor’s MicroStrategy, Coinbase, and Galaxy Digital, an investment management company for digital assets.
3. Valkyrie Bitcoin Strategy ETF
This crypto ETF invests primarily in Bitcoin futures. An ETF that has been able to outperform in recent months, unlike others that have been hurt by the downturn in the cryptocurrency market and technology in general. An ETF whose primary exchange is the NASDAQ, and which truly deserves our attention. To the point of investing? In any case, this is not advice, think about doing your own research!
4. FNB Amplify Transformational Data Sharing
Amplify Transformational Data Sharing ETF (BLOK) is one of the hottest ETFs, if not the hottest crypto ETF on the market, at least at the moment. An investment fund that has managed to select some of the most involved and successful companies in the blockchain sector, to offer investors returns that some would describe as rather attractive. The ETF’s main holdings include NVIDIA (NVDA), Coinbase Global (COIN), SBI Holdings, CME Group (CME), and Silvergate Capital (SI).
5. Grayscale Bitcoin Trust
Launched in 2013, the Grayscale Bitcoin Trust was one of the very first crypto ETFs to see the light of day. Back then, it was 2013. Since then, the fund has generated over 28,000% in returns! Naturally, this attracts investors. The result? $28 billion in assets under management, making it one of the largest crypto funds on the market.
A word of warning, the fund is open to investors willing to put a minimum of $50,000 on the table. However, GBTC shares are available to all on the secondary market, via an online broker. It’s a well-known ETF and one that Internet users love to dissect and study, particularly on social networks!
6. VanEck Digital Transformation ETF
Launched in April 2021, VanEck Digital Transformation ETF (DAPP) is a crypto ETF that tracks the performance of the MVIS Global Digital Assets Equity index. In total, DAPP has invested in no fewer than 25 projects, including Coinbase (which seems to be one of the preferred stocks for crypto ETFs), Block (formerly Square, a company set up by Twitter founder Jack Dorsey), and Silvergate Capital Corp (SI). This ETF also has an international focus, with almost 50% of its stocks based outside the USA.
7. Global X Blockchain and Bitcoin Strategy ETF
The Global X Blockchain and Bitcoin Strategy ETF is a very interesting ETF which, although it has been impacted by recent setbacks in the cryptocurrency and technology markets, remains very solid. Its portfolio includes companies specializing in blockchain, as well as Bitcoin futures. A little bit of everything, then, for a varied, diversified investment. Created in November 2021, this crypto ETF is one of those of most interest to long-term-oriented investors.
8. Siren Nasdaq NexGen Economy ETF
The Siren Nasdaq NexGen Economy crypto ETF has a wide selection of stocks in its portfolio that are closely linked to cryptocurrency, and a little further afield, to the banking, digital and digital revolution sector. Its main holdings? Coinbase (COIN), American Express (AXP), Mastercard (MA), Accenture (ACN) and Marathon Digital (MARA).
An interesting selection that seems aimed at investors wishing to position themselves on banking stocks likely to work or already working on crypto projects.
9. Capital Link Global Fintech Leaders ETF
Capital Link Global Fintech Leaders (KOIN) is a crypto ETF based on the AF Global Fintech Leaders index. It tracks digital asset companies and fintech solution providers. What makes it special? The way it determines who to work with.
A special algorithm has been developed to target equities listed in developed and emerging markets, where trading volumes and market liquidity are high.
In short, this algorithm enables us to determine the trends we should be following, so that we can position ourselves early enough to benefit all our investors. His biggest positions to date? H.I.S. Co. Ltd, Baidu Inc (BIDU) and VMWare Inc (VMW).
10. First Trust Indxx Innovative Transaction & Process ETF
The First Trust Indxx Innovative Transaction & Process ETF (LEGR) is a crypto ETF offering exposure to a wide range of stocks involved in blockchain technology. These include big-name companies such as PayPal Holdings (PYPL), Alibaba Group (BABA), Accenture (ACN), Mastercard (MA) and JD.com (JD). Companies that want to offer new solutions adapted to today’s needs, but also, above all, to tomorrow’s!
