7 Best Bitcoin ETFs of April 2024

Bitcoin ETFs: Your Gateway to Digital Gold

Find out which Bitcoin ETFs have the lowest fees and highest returns in this detailed comparison of the 7 best Bitcoin ETFs available this month.

The wait is over! After years of anticipation, the U.S. Securities and Exchange Commission (SEC) finally gave the green light to spot Bitcoin exchange-traded funds (ETFs) in January 2024. This is a game-changer for investors seeking exposure to Bitcoin without the hassle and risk of directly owning and storing the cryptocurrency. But with a growing list of contenders, choosing the best Bitcoin ETF can be tricky.

Benzinga has narrowed down the options to present the top 7 Bitcoin ETFs of April 2024. Dive deeper into this guide to discover which ETF best suits your investment goals and risk tolerance.

Let’s unlock the world of regulated Bitcoin exposure.

Bitcoin ETF Fees Comparison

When considering investing in a Bitcoin ETF, it’s essential to compare the fees associated with different options. 

Below is a table comparing the fees of several prominent Bitcoin ETFs.

Best Bitcoin ETFs to Buy

Let’s explore some of the best Bitcoin ETFs available in the market.

Fidelity Wise Origin Bitcoin Fund (FBTC)

The Fidelity Wise Origin Bitcoin Fund (FBTC) provides exposure to the price of Bitcoin, offering an alternative to direct Bitcoin purchases. Managed by Fidelity Digital Asset Management, which has a track record in Bitcoin research since 2014, FBTC aims to cater to investors with a high risk tolerance.

It invests solely in Bitcoin, a highly volatile and potentially illiquid asset, making it suitable for those comfortable with such risks. FBTC operates with a competitive fee structure, charging 0.25% of assets under management, with a fee waiver in effect until July 31, 2024. 

FBTC is not registered under the Investment Company Act of 1940 or regulated under the Commodity Exchange Act of 1936, which means shareholders may lack certain protections. As with any investment involving digital assets, investors should thoroughly assess FBTC’s investment objectives, risks, charges and expenses before considering an investment.

ProShares Bitcoin Strategy ETF (BITO)

The ProShares Bitcoin Strategy ETF (BITO) is designed to mirror the performance of Bitcoin. As the first U.S. Bitcoin-linked ETF, BITO offers investors the convenience of trading Bitcoin through a brokerage account, eliminating the need for a separate cryptocurrency exchange account or wallet.

Rather than directly investing in Bitcoin, BITO achieves its objectives by managing exposure to Bitcoin futures contracts. This strategy allows investors to gain exposure to Bitcoin’s price movements without holding the underlying asset. BITO is non-diversified and concentrates its investments, which may lead to higher volatility.

The fund incurs an expense ratio of 0.95%, and its performance is based on the midpoint of the bid/ask spread at 4:00 p.m. ET, adjusted for brokerage commissions. BITO’s net asset value (NAV) and market price are updated daily, with a 30-day median bid/ask spread of 0.03%. 

Its top holding is the Ps Cayman Bitcoin Strategy Port ETF USD, comprising approximately 25.92% of the fund’s assets. BITO was established on Oct. 18, 2021, marking its inception as a prominent player in the cryptocurrency ETF market.

Valkyrie Bitcoin Strategy ETF (BTF)

The Valkyrie Bitcoin and Ether Strategy ETF (NASDAQ: BTF) focuses primarily on Bitcoin and Ethereum futures contracts. Launched on Oct. 21, 2021, BTF aims to track the performance of Bitcoin and ether prices without requiring investors to directly own or hold the underlying cryptocurrencies. 

With a net expense ratio of 1.24%, BTF provides exposure to the crypto market through a traditional ETF. The fund’s portfolio consists of Bitcoin futures contracts, comprising 58.41% of holdings, and U.S. Treasury bills, making up 28.79%. However, investors should be aware of the inherent risks associated with investing in futures contracts, derivatives and the specific investment strategy employed by the fund. 

Despite these risks, BTF offers investors a regulated and transparent way to participate in the potential growth of the Bitcoin and Ethereum markets, catering to those seeking exposure to cryptocurrencies within the framework of a traditional investment portfolio.

VanEck Bitcoin Trust (HODL)

The VanEck Bitcoin Trust (HODL) is designed to mirror the performance of the price of Bitcoin minus the operational expenses of the Trust. Launched on Jan. 4, 2024, the Trust holds Bitcoin and calculates its share values based on the prevailing market price of Bitcoin, as determined by the MVIS CryptoCompare Bitcoin Benchmark Rate. 

With net assets amounting to $596.42 million as of April 4, 2024, HODL offers investors exposure to the cryptocurrency market through a regulated offering. Traded on the CBOE under the ticker symbol HODL, the Trust carries an expense ratio of 0.20%. 

However, investors should exercise caution because of the inherent volatility of Bitcoin prices, influenced by factors such as market demand, investor sentiment and regulatory developments. 

ARK 21Shares Bitcoin ETF (ARKB)

The ARK 21Shares Bitcoin ETF (ARKB) is incorporated in the U.S., with the primary objective of mirroring the performance of spot Bitcoin. Headquartered in New York, this ETF seeks to provide investors with exposure to Bitcoin’s price movements within a regulated and accessible investment structure. 

Launched on Jan. 4, 2024, ARKB is managed by 21Shares US LLC and boasts a net expense ratio of 0.21%. While the fund’s performance over the past year has been 22.10%, which exceeds the category average, its 3-year return stands at -0.21%, below the category average. However, its 5-year return of 1.57% surpasses the category average. 

The fund’s underlying holdings primarily consist of Bitcoin, with a geographic focus primarily on the United States. Emphasizing an alternative-asset-class focus, ARKB employs a vanilla weighting scheme, single-asset approach, open-volume and in-specie strategy. 

Bitwise Bitcoin ETF Trust (BITB)

The Bitwise Bitcoin ETF Trust (BITB) is managed by Bitwise Asset Management, a prominent crypto index fund manager in the United States. BITB aims to provide investors with accessible and professionally managed exposure to Bitcoin at a low cost. Launched on Jan. 10, 2024, and traded on the NYSE Arca exchange, the fund seeks to reflect the performance of Bitcoin, as measured by the CME CF Bitcoin Reference Rate-New York Variant, adjusted for expenses and liabilities.

With a net expense ratio of 0.20%, BITB presents an opportunity for investors to participate in the Bitcoin market while being aware of its associated risks, including significant volatility and potential for loss. The fund’s custodian, the Bank of New York Mellon, ensures the security of its assets while its auditor, KPMG, and legal counsel, Chapman and Cutler, LLP, contribute to regulatory compliance and transparency.

The sponsor’s agreement to waive the sponsor fee on the first $1 billion of trust assets for an initial six-month period underscores its commitment to investor value. BITB’s holdings primarily consist of Bitcoin, with a geographic focus primarily on the United States.

Emphasizing an alternative asset class focus, BITB employs a vanilla weighting scheme, single-asset approach, open-volume and in-specie strategy, providing investors with a well-rounded and regulated investment vehicle for exposure to the dynamic world of Bitcoin.

iShares Bitcoin Trust ETF (IBIT)

The iShares Bitcoin Trust ETF (IBIT) is offered by BlackRock, a leading ETF firm renowned for its innovation and expertise. IBIT aims to provide investors with convenient access to Bitcoin within a traditional brokerage account, streamlining the investment process similar to stocks and bonds.

IBIT is structured to reflect the performance of the price of Bitcoin, less the expenses of the trust’s operations. With a net expense ratio of 0.12%, investors should be aware of the associated risks, including potential volatility and the possibility of significant or complete loss of investment.

Trading under the ticker symbol IBIT on the NYSE Arca exchange, the fund’s inception date was Jan.10, 2024. Its 52-week range spans from $22.02 to $41.99, with a price of $38.18 as of April 23, 2024. While the fund does not offer a dividend yield or beta, its 10-day average volume stands at 39.39 million shares.

What is a Bitcoin ETF?

A Bitcoin ETF enables investors to track the price of Bitcoin without the need to directly purchase and hold the cryptocurrency itself. 

What sets Bitcoin ETFs apart is their exchange-traded nature. Unlike traditional methods of buying Bitcoin through cryptocurrency exchanges, Bitcoin ETFs are traded on well-established stock exchanges. This level of accessibility allows investors to seamlessly incorporate Bitcoin into their investment portfolios alongside stocks and other securities.

How Do Bitcoin ETF Fees Work?

Bitcoin ETFs provide a convenient avenue for investors to gain exposure to Bitcoin, but they also come with associated fees that impact overall returns. These fees cover aspects of managing the ETF and facilitating transactions.

Here’s a breakdown of the types of fees associated with Bitcoin ETFs.

• Expense ratio: The expense ratio is the primary fee charged by Bitcoin ETFs, typically on an annual basis. It encompasses various operational expenses, including administration, security, legal fees and other overhead costs incurred by the fund manager. 
• Management fees: Part of the expense ratio goes towards management fees, compensating the fund managers for their expertise in overseeing the ETF’s portfolio. 
• Custody fees: Bitcoin ETFs hold either actual Bitcoin or Bitcoin futures contracts as part of their portfolio. To safeguard these assets, the fund typically incurs custody fees paid to a qualified custodian with robust security measures. 
• Trading fees: When investors buy or sell shares of a Bitcoin ETF on the stock exchange, they may incur separate trading fees charged by their brokerage platform. These fees are independent of the expense ratio and can vary depending on the investor’s broker. 

How to Buy Bitcoin ETFs

To buy Bitcoin ETFs, investors can follow a straightforward process facilitated by brokerage platforms.

Here’s a step-by-step guide on how to buy Bitcoin ETFs.

Open a Brokerage Account

The first step is to open a brokerage account, which can typically be done online within about 15 minutes.

Fund Your Account

Once the brokerage account is open, investors can fund it by transferring money from their bank account. This can usually be done electronically through the brokerage platform’s interface. The funds transferred will be used to purchase Bitcoin ETF shares.

Search for the Desired ETF

Using the brokerage platform’s search tool or ETF screener, investors can search for the specific Bitcoin ETF they wish to invest in. They can search by the ETF’s name or ticker symbol. If unsure which Bitcoin ETF to choose, investors can compare various options available on the platform.

Place the Trade

Once the desired Bitcoin ETF is selected, investors can proceed to place their trade. This typically involves clicking a buy button and entering the details of the trade, such as the number of ETF shares to purchase and the order type. 

Pros and Cons of Buying Bitcoin ETFs

Let’s explore the pros and cons of this new type of investment.

• Simplified investment
• Increased accessibility
• Potential for diversification
• Regulated environment
• Potential cost-effectiveness

• Underlying asset volatility
• Expense ratios
• No direct ownership
• Limited track record
• Potential tracking errors

Enjoying the Bitcoin ETF Landscape

Bitcoin ETFs offer a simplified and regulated route for investors to gain exposure to Bitcoin’s price movements. They provide accessibility, potential diversification and cost-effectiveness, while direct ownership offers control and direct participation in the cryptocurrency market. Among the top 7 Bitcoin ETFs, FBTC is Benzinga’s top pick as it is offering 0% fees and a 0.25% waiver. Choose wisely based on your preferences and investment objectives.

Frequently Asked Questions

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Fidelity Wise Origin Bitcoin Fund (FBTC) has the lowest fees among all ETFs discussed

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Yes, Bitcoin ETF fees are typically annual fees. The annual fee is expressed as a percentage of the assets under management and is deducted from the fund’s returns.

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Choosing between investing in Bitcoin directly or through a Bitcoin ETF depends on personal preferences, risk tolerance and investment goals. Direct investment offers ownership and control over Bitcoin, while ETFs provide convenience and diversification. Both options have merits, and the decision should align with individual circumstances.