Crypto Market Crash - Are Crypto ETFs a viable option?

An ETF is an exchange-traded fund that allows investors to trade the underlying asset without actually owning it. Just like in stocks or commodities, crypto ETFs are pegged to the price of the crypto coin. When you invest in an ETF, you purchase a share of the fund, like a stock. The profit you make is dependent on the gains of the fund's value.

Investors who prefer a passive form of investment opt for ETF’s rather than trading cryptocurrencies actively.

How are the top Crypto ETFs performing?

The first Bitcoin ETF, Purpose Bitcoin BTCC, was launched in February 2021, and it was off to a flying start and by April acquired $1 Billion in assets. The ETF's value declined due to the drop in Bitcoin's price, but it remains stable because the fund managers can redeem shares, thereby safeguarding the fund.

Europe’s leading crypto exchange funds have surpassed €1 billion. The XBT Bitcoin Tracker, BTCetc-Bitcoin, and WisdomTree Bitcoin funds have over €100 million each. XBT Bitcoin Tracker is the largest of the three having €660 million.

Another popular fund, Amplify Transformational Data Sharing ETF (BLOK), Blockchain’s first ETF, has its net assets invested in equities of companies involved in the development of Blockchain technologies. The BLOK ETF has decreased from around $50 in April to $46 in June, thereby showing that the sharp drop in Bitcoin prices did not impact the fund too much, and it remains stable.

A glimpse into the future

Although the US Securities and Exchange Commission is not approving applications for BTC ETFs, the rest of the world is moving ahead, which seems that the sentiment is pro-ETFs.

Most of the European ETFs were launched in Switzerland, and they seem to have clearly defined the rules and regulations upfront, leading to an easier rollout of crypto ETFs in Europe.

Despite the rise and fall Bitcoin and other cryptocurrencies have been making this year, the crypto ETFs seem to hold their own and are not too much affected by the crypto market's volatility.

The future looks bright for crypto ETFs, with an increasing number of exchange-traded funds being approved, making them highly credible to investors.

Join in on the crypto ride

Investing in ETFs does require a significant amount of capital, as you have to consider the fees associated with the portfolio. Therefore, if you lack the funds to invest in ETFs, you can switch to trading cryptocurrencies with Coinlife.

Coinlife is a cryptocurrency broker that aims to provide innovative tools and resources suited for new customers. With Coinlife, you can trade 24 hours, seven days a week. Some of their benefits include a Webtrader platform that is accessible through a browser from any mobile device. Their support staff is available 24/6 to answer queries or concerns that you might encounter.

In addition, Coinlife's trading platform comes with the popular one-click-trading feature, which allows for quick order execution.

Coinlife has a transparent protocol for withdrawing funds and aims to process withdrawals within 10-14 business days.

Bottom line

Investors are pushing for more Bitcoin and other crypto ETFs to be approved; however, crypto ETFs are still a new concept. Meanwhile, you can familiarize yourself with the crypto market by joining Coinlife to start your trading journey. Coinlife's vision is to make the transition into crypto trading smooth irrespective of your level of experience.

This article does not necessarily reflect the opinions of the editors or the management of EconoTimes