What is a cryptocurrency exchange traded fund (ETF)?

A cryptocurrency exchange traded fund (ETF) is a fund consisting of cryptocurrencies. While most ETFs track an index or a basket of assets, a cryptocurrency ETF tracks the price of one or more digital tokens. Based on investor sales or purchases, the share price of cryptocurrency ETFs fluctuates on a daily basis.

What happened to cryptocurrency ETFs?

In January 2018, the Securities Exchange Commission turned down plans to set up exchange-traded funds for bitcoin and other cryptocurrencies, stating there were too many unanswered questions to allow for cryptocurrency ETFs without creating excessive risk for investors.

Should you invest in a cryptocurrency ETF?

An investor in a digital currency ETF, however, has an added layer of security in the custodian bank that supports the ETF. (For more, see: ETFs Can Be Safe Investments, If Used Correctly.) Another benefit of a cryptocurrency ETF is that it can be used to track multiple digital tokens at once.

What is the average expense ratio for cryptocurrency ETFs?

With 8 ETFs traded on the U.S. markets, Cryptocurrency ETFs have total assets under management of $696.58M. The average expense ratio is 0.95%. Cryptocurrency ETFs can be found in the following asset classes: The largest Cryptocurrency ETF is the ProShares Bitcoin Strategy ETF BITO with $544.13M in assets.