Best Bitcoin ETFs of 2024: A Comprehensive Guide

Since Bitcoin exchange-traded funds (ETFs) came out, things have changed for investors who want to get into the leading cryptocurrency. The U.S. Securities and Exchange Commission recently approved a number of spot Bitcoin ETFs, giving investors a wider range of options to choose from. 

In this comprehensive guide, we delve into the intricacies of the best Bitcoin ETFs of 2024, analyzing their features, fees, and overall market performance.

Overview of 11 Greenlighted Bitcoin ETFs

Choosing your best Bitcoin ETF option requires you to wade through 11 authorized ETFs, each representing a fusion of traditional finance and the crypto industry. These funds give investors a wide range of options, allowing them to fully experience the ever-changing world of cryptocurrency. 

Let’s delve into key details about each of these groundbreaking funds

Bitwise Bitcoin ETF (BITB)

• Bitwise Asset Management is known for its crypto-focused expertise

• Expense Ratio: 0.20%

• Introductory Fee Waiver: 0% for the first six months for up to $1 billion in assets

ARK 21Shares Bitcoin ETF (ARKB)

• The ETF is managed by ARK Invest, a prominent player in disruptive innovation

• Expense Ratio: 0.21%

• Introductory Fee Waiver: 0% for the first six months for up to $1 billion in assets

Fidelity Wise Origin Bitcoin Fund (FBTC)

• Fidelity Investments, a giant in traditional finance, manages this ETF

• Expense Ratio: 0.25%

• Fee Waiver: 0% through July 31, 2024

Valkyrie Bitcoin Fund (BRRR)

• Valkyrie Investments brings its expertise in blockchain and crypto

• Expense Ratio: 0.25%

• Introductory Fee Waiver: 0% for the first three months

iShares Bitcoin Trust (IBIT)

• iShares by BlackRock is a major global player in ETFs

• Expense Ratio: 0.25%

• Fee Structure: 0.12% for the first 12 months for up to $5 billion in assets

VanEck Bitcoin Trust (HODL)

• VanEck is a well-established investment management firm

• Expense Ratio: 0.25%

• Introductory Fee: None

Franklin Bitcoin ETF (EZBC)

• Franklin Templeton brings its financial expertise to the crypto space

• Expense Ratio: 0.29%

• Introductory Fee: None

Wisdomtree Bitcoin Trust (BTCW)

• WisdomTree Investments is known for its innovative ETF strategies

• Expense Ratio: 0.30%

• Introductory Fee Waiver: 0% for the first six months for up to $1 billion in assets

Invesco Galaxy Bitcoin ETF (BTCO)

• Invesco is a global investment management firm

• Expense Ratio: 0.39%

• Introductory Fee Waiver: 0% for the first six months for up to $5 billion in assets

Hashdex Bitcoin ETF (DEFI)

• Hashdex is a Brazilian asset manager specializing in digital assets

• Expense Ratio: 0.90%

• Introductory Fee: None

Grayscale Bitcoin Trust (GBTC)

• Grayscale Investments is a pioneer in cryptocurrency investment products

• Expense Ratio: 1.5%

• Introductory Fee: None

Analyzing the Option

An important consideration when evaluating these Bitcoin ETFs is the expense ratio. With competitive ratios of 0.20% and 0.21%, respectively, and fee waivers for the first six months, Bitwise and ARK 21Shares ETFs lead the pack. 

Two excellent options with reasonable fees are iShares and Fidelity, both of which are run by large investment firms. Fidelity stands out with its 0.25% expense ratio and fee waiver until July 2024, while iShares offers a 0.25% fee with a reduced 0.12% for the first 12 months for assets up to $5 billion.

Investors must have a thorough understanding of these fee structures because they have a substantial impact on returns in the early stages.

How to Invest in Bitcoin ETFs: A Step-by-Step Guide

Investing in Bitcoin ETFs mirrors the process of acquiring any other ETF. Follow these three simple steps to seamlessly invest in Bitcoin ETFs and incorporate cryptocurrency exposure into your investment portfolio.

Step 1: Choose and select your desired Bitcoin ETF

• Begin by logging into your brokerage account and look for ‘Bitcoin’ using the search

• Ensure that you choose actual ETFs, not some other investment tools like closed-ended trusts or direct futures contracts. Go ahead and pick a specific ETF if you have one in mind.

Step 2: Determine how much to invest

• Determine the number of shares you wish to purchase.

• Calculate the total investment based on the current ETF price. Most brokerage platforms usually do it automatically. 

Step 3: Place and execute your order

• If you want to avoid getting caught up in the wild swings of cryptocurrency prices, the limit order is the way to go. It allows you to set the maximum price per share that you are willing to pay, so you are always in control.

• Once you place an order with certain conditions, it will go through as soon as a seller agrees to the price you set. Depending on the market factors and the price you set, the execution process may happen right away or take a while.

The Bitcoin ETF shares will be added to your portfolio after the order goes through properly. Like other ETFs, the Bitcoin ETF may send you regular payments if the portfolio is rebalanced or if it makes capital gains.

BTC ETF or Bitcoin: Which One to Invest In? 

Bitcoin exchange-traded funds (ETFs) provide a regulated and hassle-free alternative for individual investors, especially those with retirement plans. Even though there is a small chance of tracking errors and you have to deal with fluctuations in trading hours and liquidity, Bitcoin ETFs are a convenient way to get into the crypto space. One of the main draws is that it removes the hassle of actually owning and managing Bitcoin.

These factors should be weighed by investors in relation to the benefits of trading Bitcoin ETFs in any brokerage account and accumulating Bitcoin exposure in addition to other assets. The decision ultimately depends on aligning investment goals with the specific features offered by each ETF. 

At the same time, you can still allocate a certain amount of funds to crypto too: just keep in mind that the best way to buy Bitcoin is to go through a reputable exchange.