Bitcoin ETFs are finally approved by the SEC.
If you haven’t had the time to follow this development, here’s what you should take note:
What is a Spot Bitcoin ETF?
A spot Bitcoin ETF is an investment fund traded on stock exchanges, much like stocks. These funds directly hold Bitcoin instead of derivatives and their value fluctuates with the price of Bitcoin in the spot market.
The ease of access to Bitcoin ETFs could attract more funds into cryptocurrency markets, providing price stability and reducing volatility previously caused by paper hands.
What are the 11 approved Bitcoin ETFs?
- BlackRock’s iShares Bitcoin Trust (NASDAQ: IBIT)
- Fidelity Wise Origin Bitcoin Trust (BATS: FBTC)
- VanEck Bitcoin Trust (BATS: HODL)
- ARK 21Shares Bitcoin ETF (BATS: ARKB)
- Bitwise Bitcoin ETF (NYSE: BITB)
- Franklin Bitcoin ETF (BATS: EZBC)
- Grayscale Bitcoin Trust (NYSE: GBTC)
- Invesco Galaxy Bitcoin ETF (BATS: BTCO)
- Valkyrie Bitcoin Fund (NASDAQ: BRRR)
- WisdomTree Bitcoin Fund (BATS: BTCW)
Hashdex Bitcoin ETF (NYSE: DEFI)*
*Hashdex’s DEFI ETF was originally a Bitcoin Futures ETFs and they had submitted a filing to convert from a futures to a spot ETF. At the point of update, their filing is still pending.
Why This Matters for investors in Singapore?
Diversification is key in managing risk, and the addition of a new asset class can potentially offer a hedge against market volatility in traditional stocks and bonds.
If you’ve been thinking of adding Bitcoin to your portfolio, but are worried about the safety of buying coins on your own, a regulated ETF may be an alternative to explore.
Disclaimer: Cryptocurrency is not suitable for all investors. You should only invest in Bitcoin and cryptocurrency if you understand the risks!
I’ve picked Bitcoin ETFs based on the lowest fees and size below, you can skip to them using the table of contents. Or, join me in taking a look at the:
Best Bitcoin ETFs that Singapore Investors can buy
| Spot Bitcoin ETF | Ticker | Issuer | Exchange | Expense Ratio | AUM (USD) | Why watch this ETF? | How Many Bitcoins held by ETF? | Daily Trading Volume (as of 12 Jan 24) | Bitcoin Custodian |
|---|---|---|---|---|---|---|---|---|---|
| Grayscale Bitcoin Trust | GBTC | Grayscale | NYSE | 1.50% | $28.6B | Largest by AUM | 617,079.99 | 47,260,925 | Coinbase |
| BlackRock’s iShares Bitcoin Trust | IBIT | BlackRock | NASDAQ | 0.25% (0.12% for 2024) |
$11.5M | Managed by the largest ETF provider | 2,620.59 | 37,708,304 | Coinbase |
| Franklin Bitcoin ETF | EZBC | Franklin Templeton | CBOE | 0.19% (0% till 2 Aug 2024) |
$2.71M | Cheapest Bitcoin ETF | 1,131 | 593,052 | Coinbase |
| Fidelity Wise Origin Bitcoin Fund | FBTC | Fidelity Investments | CBOE | 0.25% (0% till Aug 2024) |
$20.0M | 5,290.60 | 11,282,717 | Fidelity Digital Asset Services | |
| VanEck Bitcoin Trust | HODL | VanEck | CBOE | 0.25% | $81.7M | 1,640.94 | 332,145 | Gemini | |
| ARK 21Shares Bitcoin ETF | ARKB | ARKInvest | CBOE | 0.21% (0% till July 2024 or till it hits $1B AUM) |
$10.3M | 1,625 | 5,982,666 | Coinbase | |
| Bitwise Bitcoin ETF | BITB | Bitwise Asset Management | NYSE | 0.20% (0% till July 2024 or till it hits $1B AUM) |
$242.9M | undisclosed | 4,788,820 | Coinbase | |
| Invesco Galaxy Bitcoin ETF | BTCO | Invesco and Galaxy | CBOE | 0.39% (0% till 10 July 2024) |
$22.45M | undisclosed | 1,031,684 | Coinbase | |
| Valkyrie Bitcoin Fund | BRRR | Valkyrie Funds | NASDAQ | 0.25% (0% for 1st 3 months) |
$28.1M | 1,102.87 | 168,173 | Coinbase | |
| WisdomTree Bitcoin Fund | BTCW | WisdomTree | CBOE | 0.3% (0% till it hits $1B AUM) |
$3.2M | undisclosed | 86,992 | Coinbase | |
| Hashdex Bitcoin ETF | DEFI | Hashdex Asset Management and Tidal Investments | NYSE | tbu | tbu | tbu | tbu | tbu |
Grayscale Bitcoin Trust (NYSE: GBTC)
The biggest Bitcoin ETF by market capitalization due to its head start. The Grayscale Bitcoin Trust started as a private trust for accredited investors back in September 2013. In 2015, it started trading publicly as a trust on an over-the-counter (OTC) market via an alternative reporting standard.
Grayscale Bitcoin Trust was eventually converted into an exchange traded fund in January 2024 after the SEC’s approval of Bitcoin ETFs.
Although it is the largest Bitcoin ETF by market cap, GBTC is also the most expensive Bitcoin ETF, charging 1.5% fee.
- Issuer: Grayscale
- Exchange: NYSE
- Date of Inception: 11 Jan 2024 (ETF listing date)
- Sponsor Fee: 1.5%
- Daily Volume: 47,260,925
GBTC ETF Fees
The expense ratio for the GBTC ETF is 1.5%.
How many Bitcoins does Grayscale own?
The GBTC ETF holds 617,079.99 Bitcoin at the point of writing, which makes up 100% of its portfolio.
BlackRock’s iShares Bitcoin Trust (NASDAQ: IBIT)
The 2nd most popular spot Bitcoin ETF in terms of daily trading volume, IBIT ETF is managed by the world’s biggest ETF provider, Blackrock.
- Issuer: Blackrock
- Exchange: NASDAQ
- Date of Inception: 5 Jan 2024
- Sponsor Fee: 0.25% (discounted to 0.12% for 2024)
- Daily Volume: 37,708,304
IBIT ETF Fees
The expense ratio for the IBIT ETF is 0.25%. However, a portion of the fee will be waived for the first 12 months, lowering the fee for IBIT to just 0.12% for 2024.
How many Bitcoins does Blackrock own?
The IBIT ETF holds about 2,620.59 Bitcoin at the point of writing, which makes up about 51.82% of its portfolio. The remaining portfolio remains in cash (USD).
Franklin Bitcoin ETF (BZX: EZBC)
Cheapest Bitcoin ETF at the point of writing, EZBC charges a 0.19% fee which will be waived till 2 Aug 2024.
- Issuer: Franklin Templeton
- Exchange: Cboe BZX Exchange
- Date of Inception: 11 Jan 2024
- Sponsor Fee: 0.19% (waived till 2 Aug 2024)
- Daily Volume: 593,052
EZBC ETF Fees
The expense ratio for the EZBC ETF is 0.19%. However, the fee will be waived till 2 Aug 2024.
How many Bitcoins does Franklin Templeton own?
The EZBC ETF holds 1131 Bitcoin at the point of writing, which makes up 100% of its portfolio.
Fidelity Wise Origin Bitcoin Trust (BZX: FBTC)
- Issuer: Fidelity Investments
- Exchange: Cboe BZX Exchange
- Date of Inception: 10 Jan 2024
- Sponsor Fee: 0.25% (free till 1 Aug 2024)
- Daily Volume: 11,282,717
FBTC ETF Fees
The expense ratio for the FBTC ETF is 0.25%. However, the fee will be waived till 1 Aug 2024.
How many Bitcoins does Fidelity own?
The FBTC ETF holds about 5290.6 Bitcoin at the point of writing, which makes up 100% of its portfolio.
VanEck Bitcoin Trust (BZX: HODL)
- Issuer: VanEck
- Exchange: Cboe BZX Exchange
- Date of Inception: 4 Jan 2024
- Sponsor Fee: 0.25%
- Daily Volume: 332,145
HODL ETF Fees
The expense ratio for the HODL ETF is 0.25%.
How many Bitcoins does VanEck own?
The HODL ETF holds about 1640.94 Bitcoin at the point of writing, which makes up 100% of its portfolio.
ARK 21Shares Bitcoin ETF (BZX: ARKB)
- Issuer: ARKInvest
- Exchange: Cboe BZX Exchange
- Date of Inception: 10 Jan 2024
- Sponsor Fee: 0.21% (waived for 6 months or till it hits $1B)
- Daily Volume: 5,982,666
ARKB ETF Fees
The expense ratio for the ARKB ETF is 0.21%. However, the fee will be waived for six months till Jul 2024, or for the first $1B of trust assets, whichever occurs first.
How many Bitcoins does ARKInvest own?
The ARKB ETF holds about 1,625 Bitcoin at the point of writing, which makes up 100% of its portfolio.
Bitwise Bitcoin ETF (NYSE: BITB)
- Issuer: Bitwise Asset Management
- Exchange: NYSE
- Date of Inception: 10 Jan 2024
- Sponsor Fee: 0.20% (waived for 6 months or till it hits $1B)
- Daily Volume: 4,788,820
BITB ETF Fees
The expense ratio for the BITB ETF is 0.21%. However, the fee will be waived for six months till Jul 2024, or for the first $1B of trust assets, whichever occurs first.
How many Bitcoins does Bitwise own?
The number of Bitcoin in the BITB ETF is undisclosed at the point of writing.
Invesco Galaxy Bitcoin ETF (BZX: BTCO)
- Issuer: Invesco and Galaxy
- Exchange: Cboe BZX Exchange
- Date of Inception: 11 Jan 2024
- Sponsor Fee: 0.39% (waived till 10 Jul 2024)
- Daily Volume: 1,031,684
BTCO ETF Fees
The expense ratio for the BTCO ETF is 0.39%. However, the fee will be waived till at least 10 Jul 2024.
How many Bitcoins does Invesco own?
The number of Bitcoin in the BTCO ETF is undisclosed at the point of writing.
Valkyrie Bitcoin Fund (NASDAQ: BRRR)
- Issuer: Valkyrie Funds
- Exchange: NASDAQ
- Date of Inception: 10 Jan 2024
- Sponsor Fee: 0.25% (waived for 1st three months)
- Daily Volume: 168,173
BRRR ETF Fees
The expense ratio for the BRRR ETF is 0.25%. However, the fee will be waived for the first three months till 1 Apr 2024.
How many Bitcoins does Valkyrie own?
The BRRR ETF holds 1,102.87 Bitcoin at the point of writing, which makes up ~100% of its portfolio.
WisdomTree Bitcoin Fund (BZX: BTCW)
- Issuer: WisdomTree
- Exchange: Cboe BZX Exchange
- Date of Inception: 11 Jan 2024
- Sponsor Fee: 0.3% (waived for the first $1B of fund)
- Daily Volume: 86,992
BTCW ETF Fees
The expense ratio for the BTCW ETF is 0.3%. However, the fee will be waived until the fund asset grows to $1B.
How many Bitcoins does WisdomTree own?
The number of Bitcoin in the BTCW ETF is undisclosed at the point of writing.
Hashdex Bitcoin ETF (NYSE: DEFI)*
The Hashdex Bitcoin ETF is a Bitcoin futures ETF. Although Hashdex had applied for conversion to a spot Bitcoin ETF, approval of their filing is still pending at the point of writing.
Watch this space, we’ll update once DEFI has been converted to a spot Bitcoin ETF.
Best Spot Bitcoin ETF with Lowest Fees
Given that the spot Bitcoin ETFs offer the same investment objective, the only thing that sets them apart is their fee (and branding).
Here’re the Bitcoin ETFs with the Lowest Fees, after taking waivers into account:
| Cheapest Bitcoin ETFs | Current Fee | Original Fee |
|---|---|---|
| Franklin Bitcoin ETF (EZBC) | 0% till 2 Aug 2024 | 0.19% |
| Bitwise Bitcoin (BITB) | 0% till Jul 2024 | 0.2% |
| ARK 21Shares Bitcoin ETF (ARKB) | 0% till Jul 2024 | 0.21% |
| Fidelity Wise Origin Bitcoin Fund (FBTC) | 0% till Aug 2024 | 0.25% |
| Valkyrie Bitcoin Fund (BRRR) | 0% till Apr 2024 | 0.25% |
| WisdomTree Bitcoin Fund (BTCW) | 0% till fund hits $1B AUM | 0.3% |
| Invesco Galaxy Bitcoin ETF (BTCO) | 0% till 10 Jul 2024 | 0.39% |
As issuers compete on fees, I would expect some of these waivers to be extended especially if the ETF doesn’t grow to a significant size. Bookmark this page (Ctrl+D on Win or Command-K on Mac) and check back periodically for updates!
Assuming these Bitcoin ETFs will not shut down, I think that WidsomTree’s offer of fee waiver till the fund hits $1B AUM is the most attractive as it would likely take a while for BTCW to hit $1B given its current size and low daily trading volume.
Biggest Spot Bitcoin ETFs by AUM
The 3 biggest spot Bitcoin ETFs by AUM are:
- Grayscale Bitcoin Trust: $28.6B
- Bitwise Bitcoin ETF: $242.9M
- VanEck Bitcoin Trust: $81.7M
The bigger the Bitcoin ETF, the less likely it is for the ETF to be shut down. So if you’re looking to own Bitcoin for the long term, consider the bigger ETFs first.
Most popular Spot Bitcoin ETFs (by daily trading volume)
Daily trading volume can be used as a proxy for the popularity of the ETFs. Here’re the most actively traded Bitcoin ETFs as of 12 Jan 2024.
- Grayscale Bitcoin Trust: 47,260,925*
- BlackRock’s iShares Bitcoin Trust: 37,708,304
- Fidelity Wise Origin Bitcoin Fund: 11,282,717
*Daily trading volume doesn’t tell us whether investors are buying or selling the ETF. In the case of Grayscale, most of their daily volume is attributed to outflows (i.e. investors are selling enmass). This is probably due to the higher fee GBTC has compared to the other Bitcoin ETFs.
As we are in the early days of Bitcoin ETFs, I would expect the daily trading volume to drop with time. We should get a clearer idea of which ETF is the most popular in a year’s time.
Disclaimer: Cryptocurrency remains a risky asset and you should always do your own due diligence before investing your hard earn money. Investing in cryptocurrency through a spot Bitcoin ETF does not protect you from the volatilities of Bitcoin, your investment can go to zero.
Bitcoin Spot ETFs: Should you invest?
The SEC’s approval of spot Bitcoin ETFs is a watershed moment for the crypto world. It represents a blending of the new frontier of digital currencies with the traditional finance world.
As Singapore investors, we now have convenient access to Bitcoin via the same brokers that we use to invest in US stocks and ETF.
That said, prudence and a well-thought-out investment strategy should be your guides in navigating this new opportunity.
It is crucial to remember the volatile nature of cryptocurrencies. While the potential for high returns is significant, so is the risk of substantial losses. As always, any investment in these new ETFs should be measured, and aligned with your overall risk tolerance and investment goals.
You should do your own due diligence before investing in cryptocurrency. We invite crypto investor Aik Keong to share the essential fundamentals of cryptocurrency, join him at the next live Crypto 101 webinar.
Frequently Asked Questions
ELI5: Why Invest in Spot Bitcoin ETFs?
The advantage of using an ETF to invest in Bitcoin, especially for those less familiar with the cryptocurrency market, is manifold. It bypasses the need to deal with the complexities and security concerns of buying and storing digital currencies directly. A spot Bitcoin ETF also offers a regulated vehicle that is familiar to most investors.
Let’s talk practicalities.
Suppose you own a conventional portfolio mix of 60% stocks and 30% bonds. With the advent of Bitcoin ETFs, you might now contemplate adding a small allocation, say 10%, to Bitcoin. This small allocation can potentially offer disproportionate growth, given the historical performance of Bitcoin, albeit with a higher risk profile.
Previously, you had to create a crypto exchange account, complete KYC, buy your Bitcoin, then send the Bitcoin to your cold wallet. For the tech-phobic, the process was too intimidating. With Bitcoin ETFs, you can simply buy positions in the ETF via your broker just like how you’d buy the STI ETF.
Who are Bitcoin ETFs good for?
The Bitcoin ETFs are mostly great for investors who want exposure to Bitcoin without having to understand the technicalities of cryptocurrency.
What is the disadvantages of bitcoin ETF?
No investment vehicle is perfect. Bitcoin ETFs have their disadvantages, namely:
- Fee: the ETF manager has to be paid for the work of building and maintaining the ETF, and that’s an additional cost you have to accept for the convenience of a Bitcoin ETF.
- Trading hours: Unlike Bitcoin and cryptocurrency that trades 24/7, Bitcoin ETFs follow trading hours of exchanges. This could introduce a lag in price in future.
- No direct ownership of Bitcoin: while Bitcoin ETFs allow you to ride the price action of the underlying cryptocurrency, you will not own the Bitcoins directly.
- Inefficiencies in redemption process: currently, Bitcoin ETFs are required to carry out cash redemptions instead of redeeming shares in kind. This could increase the cost and bid-ask spreads of Bitcoin ETFs over time. (more details of how Bitcoin ETFs work here)
How to buy Bitcoin ETFs?
You can buy Bitcoin ETFs via your broker like any other US ETFs. We’ve compiled the best brokers you can use here.
Why do spot Bitcoin ETF prices differ from Bitcoin market price?
Due to the structure of exchange traded funds, fees and lagging entry prices could result in a difference between the price of the ETFs against the market price. This is similar to how Gold ETFs perform.
However, price movement of the ETFs should be on par with Bitcoin’s market price, allowing investors gain exposure to the price action of underlying Bitcoin assets via the ETF.
Do spot Bitcoin ETF operate 24/7?
No. Bitcoin ETFs follow the trading hours of the exchanges they are listed on:
- NYSE & NASDAQ Trading hours: Monday to Friday 9:30 to 16:30 EST (22:30 to 05:00 SGT)
- Cboe (formerly BATS) Trading hours: Monday – Friday: 9:30-16:00 EST (22:30 to 04:30 SGT)