Choosing Among Spot Bitcoin ETFs

I’m a big fan of ETF product development, but sometimes the choices can be overwhelming. For example, on our ETF Database platform there are approximately 90 ETFs offering high yield bond exposure. However, as we recently wrote, there are cost and exposure differences between them that impact performance. Last week, nine new ETFs began trading offering direct exposure to spot bitcoin, while one firm turned a pre-existing product into an ETF. This ETF wave is unlike anything I’ve seen in my career.

VettaFi Crypto Symposium Insights

VettaFi hosted a timely virtual event last Friday. The Crypto Symposium featured experts from eight bitcoin ETFs. We talked about why this is a massive win for the advisor community after a multi-year journey. Yet we also covered some of the risks to be aware of when investing.

In addition, we heard from advisors and investors. For example, VettaFi asked, “When Choosing Among Spot Bitcoin ETFs, What Matters Most to You?”, The most popular selection by respondents was Expertise of the Firm with 47% of the total. Liquidity (20%) and Expense Ratio (18%) followed, with Assets Under Management (11%) and Breadth of Offerings (3.6%) further behind.

When Choosing Among Spot Bitcoin ETFs Matter Most to You

VettaFi has long advocated for ETF due diligence efforts to go beyond simply choosing the ETF with the lowest expense ratio. However, with spot bitcoin ETFs, the focus on exposure is largely irrelevant. The ten ETFs all own bitcoin, though the price they will buy it for daily might differ. We think this is unlikely to be noticeable to most investors.