An ETF, also known as an exchange-traded fund, includes different items such as shares, bonds, goods, and cash. This fund is sold publicly on regular stock markets and follows the cost changes of a base asset.
A crypto ETF operates just like a typical ETF. It follows the shifts in the worth of digital assets, providing a controlled route for regular retail investors to put money in crypto assets without needing to own or manage them directly. This makes the sometimes tricky tasks associated with owning crypto a bit easier.
A crypto ETF needs to be run by a company that securely stores the related digital currency. Investors then buy shares, which showcase their investment in the listed ETF on the exchange.
Benefits of crypto ETFs
Crypto ETFs offer several advantages, including:
- Cost-effectiveness:
Buying a crypto ETF lets you own the item for less money than the actual crypto coin. This is especially useful for new investors dealing with the high price of crypto, such as Bitcoin. Thus, a crypto ETF becomes a more practical option.
- Hassle-free:
Crypto comes with extra costs, like fees for keeping it and yearly charges for crypto wallets. Crypto ETFs take care of these worries for the company that offers them. Investors don’t have to deal with the complexity of trading crypto; they get an easy-going investing atmosphere.
Best crypto ETF
Some notable crypto-ETFs include:
- Amplify Transformational Data Sharing ETF (BLOK):
This ETF focuses on blockchain technology. It showcases crypto stocks such as CME Group, a finance firm dealing with cryptos like Bitcoin and Ethereum. Also, it includes Coinbase Global Inc.
- Siren NASDAQ Economy ETF (BLCN):
This fund focuses on investing in businesses that work on exploring, creating, and using blockchain technology. It mainly invests in companies like Coinbase and Marathon Digital Holdings.
- Bitwise 10 Crypto Index Fund:
This unique ETF puts money into the top 10 cryptos based on their current market size. The firm modifies this roster each month as per the crypto costs. Bitcoin, with a 61% share, and Ethereum, with a 29% share, command the collection. It also contains well-known digital currencies such as Cardano, Solana, and Avalanche. Importantly, this ETF is exchanged outside the traditional stock exchange and comes with a 2.5% expense rate.
Read more: What is Crypto
How to invest in crypto etf?
To get into crypto ETF investments, you need an investment account, like an individual brokerage account. Make the account and put cash in. Now you’re set to invest in crypto ETFs. Here’s the simple process for ETF investment:
- Initiate the process by opening an investment account.
- Proceed to fund the investment account with cash.
- Choose the specific crypto ETF(s) you intend to acquire.
- Execute the necessary trades to purchase shares in the chosen crypto ETF(s).
Conclusion:
With crypto ETFs, investors gain a handful of perks. This includes putting money into digital cash and related tech without owning any crypto on their own. But it’s also wise for investors to stay careful about possible drawbacks with crypto ETFs. This could be due to formative regulations and market swings. Like with any type of investment, it’s always important for investors to do their homework and check their comfort level with risk before buying shares in these funds.
You can now Buy Cryptos with ZebPay India’s largest and trusted crypto exchange.
Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Each investor must do his/her own research or seek independent advice if necessary before initiating any transactions in crypto products and NFTs. The views, thoughts, and opinions expressed in the article belong solely to the author, and not to ZebPay or the author’s employer or other groups or individuals. ZebPay shall not be held liable for any acts or omissions, or losses incurred by the investors. ZebPay has not received any compensation in cash or kind for the above article and the article is provided “as is”, with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information.
