Blockchain ETF vs Bitcoin ETF: Where To Invest?

By chirag
July 27, 2021 5. min read
Last update on: September 3, 2021

As it is said, necessity is the mother of invention!!

The advancing necessities towards safe and easy transactions is giving birth to many technological developments. 

One such technological development is Crypto ETF.

Although cryptocurrency bitcoin has gained a tremendous popularity over the time globally and has been in the limelight for many years, ETFs (exchange-traded funds) are no doubt a pipe dream for the blockchain users. 

Blockchain ETFs in the mainstream market have already made their debut, and no doubt they were an absolute hit.

But the problem arises when bitcoin and blockchain terms are used interchangeably. It is very much possible to confuse the bitcoin ETFs with the blockchain ETFs. It is true that both of them complement each other but they are totally different.

Basically, a blockchain ETF holds a crate of traded organizations having blockchain technology ETF exposure. These organizations can either directly utilize the technology or benefit from their services to help with the development. There are two kinds of blockchain ETFs: Passively managed and Actively managed.

According to a study from, The 2020 Benchmark Survey of Financial Advisor Attitudes Toward Cryptoassets (image below), it is discovered that the financial advisors in the U.S. are keen to put their clients’ money into cryptocurrency exchange-traded funds (ETFs).

crypto investment preference

The DeFi is capturing new trends and one of them is the ETF. When we talk about ETFs, then there are multiple things which attract investors. Let us first understand the meaning of blockchain and bitcoin ETF and then we will move towards the difference between the two.

What Makes Blockchain ETF Stand Out?

Blockchain ETF is more like an average ETF where the invested company is different from an average company. It is similar to standard sector-based stock investments through the ETF category or Exchange Traded Funds. The ETFs are targeted towards a plethora of companies that deal in blockchain technology.

Blockchain companies are directly involved in profit or loss-making when people invest in blockchain technology ETFs. Blockchain means the new technology trend used for maintaining a transaction ledger and works as a decentralized unit, thus cutting costs substantially. Records have shown that investing through blockchain, ETFs have been quite risky because the companies involved in this category are mostly tech companies that work as new startups.

The problem that has been seen with these startups is that they have no guarantee of returns for the future, and they are a common defaulter on the monetary issue list and hit global regulatory roadblocks more often than not.

You will be amazed to know but post the two weeks after their launch, investors had put about $180 million in the blockchain ETFs. The volume of trading for these ETFs was much higher when compared to the other similar instruments which have been launched 4 years back in 2017 only. 

Below are some famous and best blockchain ETF cryptocurrency lists.

popolar Blockchain ETFs

What is Bitcoin ETF?

An ETF or Exchange Traded Fund represents a pool of companies that have the same point of service. This allows the investors and customers to find a broader screen of companies with the same aim rather than swimming in an endless ocean of companies to make up a portfolio containing various individual blockchain technology stocks from different companies.

ETF for bitcoin cryptocurrency, is the future of cryptocurrencies that makes a similar pool where investors can get daily updates on price and latest bitcoin ETF  news. Since there are many risks involved in buying bitcoin or even a part of it, bitcoin ETF fund eliminates that problem. Here investors do not need to buy bitcoin directly, but they are open to getting all sorts of updates and daily price listings on the global and domestic levels.

There are not many available companies for investing in blockchain etf funds since there are no proper regulations till now. Most of the companies are still in an under-process state of their application as most of them have not been approved yet and will take some time.

The Gemini Exchanges 2021 State of UK Crypto Report found out that 27.5% of the people in the age group between 18-24 years old were invested in Crypto ETF.

Bitcoin ETF cryptocurrency differ according to their structure, fees, availability, and exposure. Below are some Bitcoin crypto ETF lists which are popular.

popular bitcoin ETFs

How Different are Blockchain ETF and Bitcoin ETF?

There are a few fundamental differences between mainstream blockchain ETFs vs bitcoin ETFs. Some of them are discussed herewith.

  • Blockchain technology stocks are already a part of the mainstream stock market and are a hot favorite for people with some potential showing. Whereas, ETF for bitcoin stock has not made it to the mainstream stock market due to government restrictions and is still done on a virtual, hypothetical basis.
  • Given the current scenarios, ETF cryptocurrency one of the best ways to invest in blockchain has taken a lot of blows from regulatory authorities and, of course, the government, which has created a lot of hindrance in its launch path. On the other hand, blockchain technology stock is a safe side of the market that does not face any regulatory changes or issues and nor is it under any scrutiny.
  • The primary task of blockchain ETF is to accommodate all the companies that deal in blockchain technologies or have directly invested in global blockchain technologies stock, making it available for general investors to pour funds in. On the flip side, the ETF for bitcoin still has no future or even no forward talks suggesting that it would be launched into the standard stock market. The main problem that the bitcoin market faces is they need more and more experts on board to lead and advise the regulatory authorities regarding its benefits and the scope in the future.
  • The global blockchain technologies stock has found a place in five of the top global trading regulatory markets, namely the Siren Nasdaq NexGen Economy ETF, the Capital Link NextGen Protocol ETF, VanEck Vectors Digital Transformation ETF, First Trust Indxx Innovative Transaction and Process ETF and the Amplify Transformation Data Sharing ETF. On the other hand, the bitcoin ETF pool has still not been launched in the standard blockchain technology stocks and trade regulatory markets. Since most applications from companies regarding the bitcoin ETF fund market are still under approval, it has not made a successful path into the stock market.

blockchain-systematic-value

Parting Thoughts

Hence both these ETF options need development to be better and be more successful. They both need to work on their weak links to achieve great success in the market. In general, we can claim that the new trend is of ‘Digital Currencies’ that have become an important thing for investors.

If you still have doubts about why invest in bitcoin or global blockchain technologies stock or how to invest in bitcoin ETF, then the only thing left for you to do is find a trustworthy and reliable blockchain development company. A good blockchain development company like Appinventiv will help you expand your decentralized journey and keep you updated with bitcoin etf news.

Chirag Bhardwaj
chirag
Blockchain Evangelist
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