3 Crypto ETFs for Exciting Exposure to Digital Assets
In the wake of the newest financial crisis, cryptocurrencies ripped higher. That was all thanks to key two catalysts. One, there’s news the U.S. government will insure virtually all deposits at the Silicon Valley Bank. Two, there’s…
In the wake of the newest financial crisis, cryptocurrencies ripped higher. That was all thanks to key two catalysts. One, there’s news the U.S. government will insure virtually all deposits at the Silicon Valley Bank. Two, there’s speculation that interest rate hikes could now slow down, or be halted. Not only has that been positive for cryptocurrencies, but also for crypto stocks and crypto ETFs.
“As actors begin to understand the role which U.S. monetary policy, inflation, and increases in interest rates have played in the current banking sector challenges, you are likely seeing a move towards Bitcoin (BTC-USD) and other forms of crypto as a reflection of their potential value as a hedge and alternative store of value during such times,” says Gabriella Kusz, CEO, Global Digital Asset & Cryptocurrency Association, as quoted by Bankrate.com.
However, if digital asset investing isn’t for you, there are always cryptocurrency miners, or even stocks like MicroStrategy, which owns about 130,000 Bitcoin. Or, you can always diversify at low cost with digital asset ETFs, such as the following.
ProShares Bitcoin Strategy ETF
ProShares Short Bitcoin
Global X Blockchain & Bitcoin Strategy ETF
ProShares Bitcoin Strategy ETF (BITO)
Since bottoming out around $9.50 in late 2022, the Pro Shares Bitcoin Strategy ETF (NYSEARCA:BITO) rocketed to a recent high of $14.98. From here, I’d like to see it initially refill its bearish gap around $17.50, and then potentially refill around $22.50. With an expense ratio of 0.95%, the ETF tracks the performance of spot Bitcoin, and is the world’s largest and most actively traded cryptocurrency ETF, according to ProShares.
BITO is mimicking the price of Bitcoin as closely as possible without investing in the cryptocurrency itself. As noted by Money.com, “Like all crypto ETFs, part of the allure of BITO is that investors don’t need to deal with cryptocurrency wallets and private keys but can instead invest through a broker they already use.”
ProShares Short Bitcoin (BITI)
Or, if you believe Bitcoin will drop in price again, or if you want to hedge a long bet, there’s also the ProShares Short Bitcoin (NYSEARCA:BITI). This one follows the S&P CME Bitcoin Futures Index, with profitability computed daily (before fees and expenses) as the inverse (-1x) of the index’s daily performance. BITI has an expense ratio of 0.97%. At the moment, BITI trades at $24.69 – gapping lower, after Bitcoin rocketed higher.
Global X Blockchain & Bitcoin Strategy ETF (BITS)
Another hot digital asset ETF to consider is the Global X Blockchain & Bitcoin Strategy ETF (NASDAQ:BITS). With an expense ratio of 0.65%, the BITS ETF takes long positions in U.S. listed bitcoin futures contracts and invests, directly and/or indirectly, in companies positioned to benefit from the increased adoption of blockchain technology, as noted by Global X ETFs.
While BITS doesn’t invest in Bitcoin directly, it does offer investors exposure to crypto companies working on next-generation technologies, creating the potential for outsized return, added Global X ETFs.
On the date of publication, Ian Cooper did not have (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.
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