Cryptocurrencies like Bitcoin and Ethereum have become a new way to build and store wealth. Many people buy these digital assets directly. However, others look for other options, like exchange-traded funds (ETFs). These ETFs enable interested parties to acquire digital currencies without claiming ownership.
Canada introduced the first Bitcoin and Ethereum ETFs in 2021. These ETFs make it easy for investors to gain exposure to crypto in tax-advantaged accounts like tax-free savings accounts (TFSAs) or registered retirement savings plans (RRSPs). This move was a big deal in the financial world.
According to Sean Farrell, head of digital asset strategy at Fundstrat, Bitcoin ETFs could become more valuable than gold ETFs. He forecasts that Bitcoin ETFs will likely hit a market value worth more than $300 billion.
Ethereum ETFs are also becoming popular. Ethereum is very significant in the blockchain technology space. Its currency, Ether, is the second-largest crypto coin coming after Bitcoin.
Here, we will look at the top Canadian cryptocurrency ETFs available today.
Purpose Bitcoin ETF (TSX: BTCC)
The Purpose Bitcoin ETF was the world’s first physically-backed Bitcoin ETF. It launched in February 2021 and is backed by real Bitcoin stored in cold storage. This means investors don’t need a digital wallet to buy and sell Bitcoin through this ETF.
Purpose Investments, a Canadian company, manages the ETF. Over 26,000 Bitcoins back it, and it has a management fee of 1 percent. Investors like this ETF because it offers easy access to Bitcoin without the need for technical knowledge.
CI Galaxy Bitcoin ETF (TSX: BTCX.B)
Launched in March 2021, the CI Galaxy Bitcoin ETF is another top Canadian Bitcoin ETF. CI Global Asset Management and Galaxy Digital, a leader in cryptocurrency financial services created it. Like the Purpose ETF, it stores Bitcoin in cold storage.
Among this ETF’s best qualities is its low management fee. It charges only 0.4 percent, making it one of the cheapest crypto ETFs on the market. This low fee is a big plus for investors looking to get the most out of their money.
Fidelity Advantage Bitcoin ETF (TSX: FBTC)
This is the newest ETF on this list. It launched in November 2021 and offers investors the reliability of Fidelity’s well-known cold storage services. This ETF aims to give investors safe exposure to Bitcoin.
The management fee was initially 0.4 percent. But in January 2024, it was lowered to 0.39 percent, making it even more affordable. This ETF is perfect for investors who want a secure and low-cost way to invest in Bitcoin.
CI Galaxy Ethereum ETF (TSX: ETHX.B)
The CI Galaxy Ethereum ETF was launched in April 2021. Like its Bitcoin counterpart, this ETF collaborates with CI Global Asset Management and Galaxy Digital. It gives investors exposure to Ether, Ethereum’s digital currency.
This ETF allows investors to track the price of Ether while holding their assets in cold storage for safety. The management fee is just 0.4 percent, which makes it one of the cheapest Ethereum ETFs available. Ethereum is known for being the backbone of many blockchain technologies, making this ETF a popular choice.
Purpose Ether ETF (TSX: ETHH)
The Purpose Ether ETF was also launched in April 2021. It’s a direct-custody ETF, which is backed by physical Ether stored in cold storage. The fund holds over 98,000 Ether and allows investors to follow daily price changes in the Ethereum market.
Like the Purpose Bitcoin ETF, this fund has a management fee of 1 percent. It’s a good option for investors looking for a simple way to get into Ethereum without managing a digital wallet.
Why Canadian Crypto ETFs Are a Good Choice
Canadian crypto ETFs are appealing for many reasons. First, they offer easy access to Bitcoin and Ethereum without needing to handle the technical aspects of crypto. Investors can buy these ETFs in their tax-sheltered accounts, which helps them save on taxes.
Another reason is safety. These ETFs store the crypto assets in cold storage, considered the most secure way to hold cryptocurrencies. This reduces the risk of hacking or theft.
Some of these funds, like the CI Galaxy Bitcoin ETF and the Fidelity Advantage Bitcoin ETF, also offer low fees, which makes them attractive. Minimal charges mean buyers can keep much of their returns over time.
How to Choose the Right ETF
Choosing the right crypto ETF depends on a few key factors. First, look at the management fees. Lower fees are better because they leave more room for profits.
Second, consider the asset under management. Bigger ETFs tend to be more stable and easier to buy and sell. Finally, think about your goals. Do you want to invest in Bitcoin, Ethereum, or both? Some ETFs focus on one cryptocurrency, while others offer exposure to both.
Other Areas Why Crypto ETFs are Dominating
Cryptocurrency is not just reshaping the financial world. It is also transforming how online casinos operate. Some of the best online casinos in Canada now accept Bitcoin and Ethereum as payment methods. These digital currencies are a great option for Canadians who play in online casinos since they offer fast and secure transactions. As crypto becomes more mainstream, its use in online casinos is expected to grow, and more casinos will support crypto transactions.
Conclusion
Canadian crypto ETFs are a great way to invest in digital assets like Bitcoin and Ethereum without directly owning them. These ETFs offer investors tax advantages, security, and easy access.
Whether you are interested in Bitcoin or Ethereum, ETFs are available to meet your needs. The low fees and safe storage options make these funds a good choice for long-term investors. As cryptocurrency continues to grow in popularity, more and more investors will likely turn to ETFs as a convenient way to participate in this exciting market.
