An ETF, or exchange-traded fund, is a financial tool used to track the performance of traditional assets: we list here the best options for Bitcoin and cryptomorphic ETFs currently on the market
Investment firms have started offering ETF products for Bitcoin. The world’s leading cryptomeda has really earned its position as “something that’s here to stay” and so far proved its critics wrong about its longevity. The US SEC has shown some hostility towards Bitcoin in the past, having rejected several Bitcoin ETFs since 2017, and it is unlikely that it will approve a Bitcoin ETF, at least until cryptomoeda proves that it pleases the committee.
As Bitcoin and cryptomoeda increasingly appear on the radar of investors with a traditional business background, products such as ETFs will encourage them to invest in cryptomoeda without having to compete with portfolios, withdrawals, deposits and the volatility of cryptomoeda markets.
However, concerns about digital asset price manipulation have prevented the emergence of a fully regulated product so far.
Here we list the top 3 2020 Bitcoin ETFS that we believe will prove their worth by 2021.
Bermuda Stock Exchange ETF
The world’s first Bitcoin ETF product was launched in Bermuda. After the US SEC repeatedly blocked applications for Bitcoin ETFs, the Bermuda Stock Exchange (BSX) launched its exchange on 18 September 2020.
The fund tracks a “portfolio of crypto and blockchain-based assets that are tracked by the index.
Up to 3 million E-class shares are expected to be available for trading, although it is unclear which cryptocracks are tracked by the fund. The shares will cost $1,000 each – so this may not be suitable for those who do not have the capital to take the risk and invest in the fund.
Hashdex CEO Marcelo Sampario said Bermuda was chosen because of its cryptomore-friendly regulatory environment and that the ETF will “speed up the entry of institutional investors into this segment. It is a trend that is becoming more and more concrete”.
Gibraltar Stock Exchange
The other recent addition to the potentially growing list of Bitcoin Evolution ET is one on the Gibraltar stock exchange. Called “The Bitcoin Fund”, this ETF is targeted at investors based in Europe, according to the BTC Times.
First launched in Canada, where the ETF is currently being traded, the fund will now be a source of investment for European investors concerned about the current unstable global economy and rising inflation, as Covid continues to have an impact on the global economy.
In addition, the fund facilitates entry for investors who wish to expose some of their portfolios to the growing crypto market without having to navigate using hardware portfolios or manipulate private and public keys.
3iQ, the fund’s issuer to the Gibraltar Stock Exchange, claims that the ETF is one of the first Bitcoin regulated ETFs in the world to reach a fully regulated exchange in Europe. 3iQ’s CEO, Fred Pye, said this opens the door to sovereign wealth funds and pension funds wishing to access a fully regulated Bitcoin product that offers some security for investments outside the wild west of the cryptomeda market.
Pye added that, “Being listed on the Gibraltar Stock Exchange extends the reach of the Bitcoin Fund in the growing European digital asset market and continues the wave of momentum that defined the exciting progress of 3iQ during the first half of 2020.
Greyscale Investment Fund
Although not strictly an ETF, this fund deserves a mention. Grayscale has earned headlines in recent weeks for its purchase of cryptomeda to add to its reserves and AUM (asset under management)
Greyscale currently holds an astonishing $10.4 billion in AUM in cryptomime assets – just over a year ago, in December 2019, the company held only $1 billion in AUM to put this into perspective.
Some of these gains are due to increases in the crypto market, but the company’s accumulation is still impressive, to say the least.
Investing in the fund means investors can benefit from a bond rather than direct exposure to crypto markets.
Of its products offered, Grayscale Bitcoin Trust (GBTC) remains the most popular for now.