7 Best Bitcoin ETFs To Buy in 2023 (2024)

An ETF, or exchange-traded fund, is a collection of similar investments that people can buy. ETFs create a diversified portfolio without the investor having to choose from a multitude of stocks. Similarly, bitcoin ETFs are collections of bitcoin-related investments. If you would like to get into crypto investing but feel investing in bitcoin carries too much risk — or you don’t want to worry about finding the best places to store your crypto — investing in a bitcoin ETF could be for you.

An article by Forbes points out that bitcoin ETFs currently do not include bitcoin, but, instead, hold bitcoin futures contracts or stocks of companies related to bitcoin and other crypto. For instance, a bitcoin ETF may include the stock of a crypto exchange, the manufacturer of cold wallets or — more commonly in the case of the best bitcoin ETFs — bitcoin futures.

Investing in Bitcoin ETFs

The SEC has currently approved just a handful of bitcoin ETFs for trading. While GOBankingRates is calling these the best bitcoin ETFs to buy in 2023, they are also the only available ones for bitcoin futures — at least, for now.

ProShares Bitcoin Strategy ETF

ProShares was the first bitcoin ETF to hit the market, back in October 2021. It garnered $1 billion in growth in its first few days. The ETF has fallen dramatically since its launch, in line with the crypto winter that saw bitcoin lose 62% of its all-time high value. The crypto has plummeted from over $68,000 on Nov. 10, 2021, to around $25,380 as of June 15, 2023.

Likewise, Proshares (BITO) is down 60% during the same period. You’ll find similarly bearish numbers with all the ETFs on this list. The crypto winter could represent a time to buy. As investor and author Robert Kiyosaki tweeted at the start of the crypto crash of 2022, “Crashes are the best time to get rich.”

In addition to bitcoin futures, the ProShares BITO ETF holds Treasury securities and cash, according to the fund’s fact sheet, which provides some diversity and a hedge against the crypto winter. The ETF is currently trading at just under $15 per share, which could provide an opportunity to take a position without a huge investment.

ProShares Short Bitcoin ETF

If you are bearish about bitcoin and believe the current crypto winter will drag on with no rebound in sight, you might consider ProShares Short Bitcoin ETF (BITI). Unlike the other ETFs on this list, the ProShares Short Bitcoin ETF is speculating on a further decrease in the price of bitcoin.

However, it doesn’t track trends — it aims for a return that is -1x the return of the underlying benchmark for just one day. That makes the fund as volatile as bitcoin futures on a day to day basis and has resulted in a 46% decline in value since its June 2022 inception date.

With some experts stating that the crypto winter could end this year or next, there is still time to get in on BITI if shorting bitcoin futures fits your risk profile — and you qualify for the margin account you’ll need to trade it.

Valkyrie Bitcoin Strategy ETF

Valkyrie trades almost exclusively in bitcoin futures and currently has $27 million in assets. Assets could be made up of government securities, money market funds and corporate bonds. It does not deal in bitcoin stocks or companies otherwise related to bitcoin. For this reason, Valkyrie tracks closely to bitcoin’s value but, the company warns, “investors seeking direct exposure to the price of bitcoin should consider another investment.”

Part of the Nasdaq Composite, Valkyrie is an actively managed ETF listed as “non-diversified” under the Investment Company Act of 1940. It may hold a limited number of U.S. Treasury bills, but about 50% of its net assets are tied up in bitcoin futures as of June 15. Valkyrie is trading at just $10 per share. If you believe the crypto winter will, ultimately, pass, Valkyrie could be a solid investment to buy and hold.

VanEck Bitcoin Strategy ETF

While VanEck aims to hold most of its investments in bitcoin futures, it may have some assets invested in Treasury bonds and cash — in fact, the fund held fewer than 300 futures contracts as of June 13, amounting to less than 1% of the fund’s assets. Treasury bills made up the rest. While shares are down over 21% for the year, they’re up nearly 60% year to date following the fund’s best quarter ever, which saw a 70.29% gain. The fund traded for $25.21 on June 15.

VanEck differs from the other investments on this list because it is managed as a C-Corp tax entity, rather than a registered investment corporation. That means it doesn’t have to distribute dividends to investors, which could mean lower taxable distributions. VanEck also manages a number of other stock- and futures-based ETFs, including VanEck Gaming, VanEck Environmental Services, VanEck Biotech, VanEck Video Gaming and eSports, and VanEck Digital Transformation.

VanEck is one of several investment firms that has filed an application for a bitcoin spot ETF, which would track the price of bitcoin, rather than bitcoin futures. However, the Securities and Exchange Commission struck down its application for the third time in March.

AdvisorShares Managed Bitcoin Strategy ETF

The actively managed AdvisorShares Managed Bitcoin Strategy ETF (CRYP) invests primarily in bitcoin futures, with some government securities, cash and even affiliated ETFs as part of its portfolio. Depending on the price of bitcoin, the fund can reduce or increase its bitcoin futures exposure from zero to 100%. It only manages $390,679 in assets. It reached the market in April 2022.

Actively managed by Mark Yusko, CEO and chief investment officer of Morgan Creek Capital Management, the fund reduces much of the risk related to bitcoin futures, as well as the investment challenges associated with trading bitcoin. It’s down 17.63% since its inception.

Global X Blockchain and Bitcoin Strategy ETF

Global X combines bitcoin futures and blockchain stocks to create a more diversified portfolio than many of the other ETFs on this list. Specifically, Global X holds shares of the Global X Blockchain ETF, which focuses on blockchain development companies, crypto exchanges and digital mining companies. In August 2022, the company divided its $10 million in assets with 44% in bitcoin futures and 56% in the Global X Blockchain ETF.

Global X’s experience with global exposure across multiple industries could make the ETF an enticing investment. It is currently trading midway between its 52-week high and low, leaving plenty of room for growth.

Hashdex Bitcoin Futures ETF

Hashdex Bitcoin Futures ETF aims to track the day-to-day price changes of the Hashdex U.S. Bitcoin Futures Fund Benchmark. The benchmark uses bitcoin futures contracts listed on the Chicago Mercantile Exchange, averaging the closing settlement prices of the first and second to expire each day.

With a Sept. 15, 2022, inception date, the fund doesn’t have much of a track record, but its performance has been impressive so far. As of June 15, it has gained 54.04% year to date and 31.80% since its inception. Nine-nine percent of the fund’s $1.98 million in assets are invested in bitcoin futures; the rest is held in cash.

What Are Bitcoin Futures?

Futures represent a legal agreement to purchase or sell a specific commodity at a predetermined price at a specific time. When you purchase bitcoin futures, you are agreeing to purchase bitcoin. Keep in mind, when you trade in futures, you sell the commodity before it ever reaches your hands. You don’t have to worry about selecting a crypto exchange or purchasing a cold wallet for secure storage. You won’t actually hold bitcoin.

The Securities and Exchange Commission will not permit ETFs to hold bitcoin or other crypto, since crypto is traded on non-regulated exchanges. Futures, on the other hand, are regulated by the SEC. Many advanced investors are familiar and comfortable with futures, so these ETFs are growing rapidly as an alternative to bitcoin trading.

Final Take

Bitcoin ETFs allow you to take advantage of a high-risk — and potentially high reward — asset without actively managing your portfolio. A bitcoin ETF could be the right choice if you don’t want to mess with the technology behind trading bitcoin and prefer a regulated investment.

You should speak to a financial advisor who can offer the guidance you need and help you add bitcoin ETFs to your portfolio or begin an investment account.

Daria Uhlig contributed to the reporting for this article.

Information is accurate as of June 14, 2023.