In this post, we will be reviewing the offering for Bitcoin and Ethereum ETFs in Canada. We will first have a look at the advantages of holding an ETF rather than the cryptocurrency directly. Then we will compare the prospects for both Bitcoin and Ethereum. Finally, we go through the ETFs available in the market thus far (comparison of MER and Asset under management).
What’s a Bitcoin
You can review our previous post or check the more detailed source below.
We suggest CoinDesk bitcoin 101 (https://www.coindesk.com/learn/bitcoin-101/what-is-bitcoin)
Advantages of holding crypto ETFs:
This is one of the greatest features of holding a cryptocurrency ETF. You can take advantage of the growth potential of these speculative investments within a registered account.
You cannot accomplish this if you invest in Bitcoin or Ethereum directly.
Simple to trade and safety
Buying bitcoin or Ether can be challenging. Investors need to familiarize themselves with a lot of new concepts before even considering acquiring cryptocurrencies. Add to this, the choice of platform is left to the investor when he acts on his own and the storage/safety too.
Cryptos in ETFs are Physically settled and safely held in cold storage. Cold storage is a way of holding cryptocurrency tokens offline (so inaccessible for hackers).
No wallet required
When you buy a Crypto ETF, there is no need of a wallet account.
Should you buy a Bitcoin ETF or an Ethereum ETF?
Bitcoin and Ethereum rely on the same technology. This being said, they are quite different when it comes to the purpose. In essence, Bitcoin’s objective is to become a true currency. It has achieved a lot of head wings in the past years. According to Coinbase, 20% of all Bitcoin transactions were actual payments for exchange of services. Slowly, Bitcoin is becoming widely accepted and viewed as an alternative to national currencies. Besides, the entry of institutional investors into this market will for sure bring some stability in comparison to the rocky beginning of Bitcoin. As a bitcoin ETF holder, you are part of the movement that will stabilize Bitcoin.
What makes Bitcoin appealing is the cap of 21 million units that can be created. This limited supply will help Bitcoin keep a threshold value.
On the other hand, Ethereum was intended as a platform to facilitate smart contracts via its own currency. As more and more smart contracts and decentralized applications are built Ethereum’s popularity and profitability will increase. There is no cap in the number of Ethereum that can be created. Ethereum has gained credibility when Microsoft and ConsenSys partnered to offer Ethereum Blockchain as a service on Microsoft Azure.
Advantages and Disadvantages
|+ Advantages||– Disadvantages|
|Bitcoin||Bitcoin technology is well established |
Bitcoin is more and more popular and
with the entry of institutional investors,
the volatility would be lower
Limit of 21 Millions makes it valuable
|Government regulations can |
hinder its growth
|Ethereum||Technology is promising but not |
yet well established High risk but also
high reward if technology becomes
|Government regulations can hinder |
No cap on the number of
Ethereum that can be created makes it
less appealing for some investors
Newer technology than Bitcoin, so
more risk and more potential growth
Bitcoin ETFs offering
|BTCC||Purpose Bitcoin |
|BTCX-B||CI Galaxy Bitcoin |
Cad Unhedged Unit
|BTCX-U||CI Galaxy Bitcoin |
Usd Unhedged Unit
Bitcoin ETFs performance comparison
The CI Galaxy Bitcoin stands out for its low MER in comparison with BTCC purpose bitcoin.
BTCC Purpose bitcoin
Purpose Bitcoin ETF (the “Fund”) invests in and holds substantially all of its assets in long-term holdings of the digital currency bitcoin. Its considered a high risk investment. As such, it should not constitute a large portion of your portfolio but rather a minimal portion.
BTCC-B: Trades in Canadian dollars
BTCC-U: Trades in US dollars
BTCC: Trades in Canadian dollars and is hedged against currency fluctuations.
CI Galaxy Bitcoin
The ETF’s investment objective is to provide holders of units exposure to bitcoin through an institutional-quality fund platform.
BTCX-B: Trades in Canadian dollars
BTCX-U: Trades in US dollars
Ethereum ETFs offering
|ETHH Purpose Ether ETF (Cad Denominated Curre)||12||1.00|
|ETHH.B Purpose Ether ETF||12||1.00|
|ETHH.U Purpose Ether ETF US dollars||7||1.00|
|ETHX.B CI Galaxy Ethereum ETF B||1||0.40|
|ETHX.U CI Galaxy Ethereum ETF US dollars||17||0.40|
Ethereum ETFs performance
Purpose Ether ETF
Purpose Ether ETF invests in and holds substantially all of its assets in long-term holdings of the digital currency ether (“Ether”).
CI Galaxy Ethereum ETF
The ETF’s investment objective is to provide holders of units exposure to Ether through an institutional-quality fund platform.