17 Best Crypto ETFs to buy in 2023 [Top-Performing ETFs]

Check out this exclusive list of the top-performing new Cryptocurrency ETFs. We have reviewed and compared the best Crypto ETF funds available in the market for investment. This article on the Cryptocurrency Exchange Traded Fund (ETF) will also educate you on how to buy Crypto ETF funds.

Crypto investment funds include exchange-traded funds, indexes, venture funds that invest in crypto firms, crypto mutual funds, crypto hedge funds, cryptocurrency trusts, and crypto-adjacent funds.

Besides the funds that involve pulling together investor funds to invest them in crypto firms, spot crypto, other index funds, and ETFs, the latter has become very popular. This is given huge interest by institutional investors and the ability to trade them in regulated stock markets.

This tutorial dwells on the best crypto ETFs, trusts, and other crypto investment funds you can invest in within regulated environments for those who love those types of investment environments. The tutorial also enlightens on the types of crypto investment funds.

Best Crypto ETFs – Review

Types of Crypto Investment Funds

Venture Funds: Most–or 95% of all crypto investment funds are either venture funds or hedge funds. Venture funds invest directly or indirectly in crypto startups and firms by providing capital and other forms of funding.

Examples: Union Square Ventures, Pantera Capital, Draper Associates, FBG Capital, Digital Currency Group, MetaStable, Galaxy Digital, 1confirmation, Hack VC, and Arrington XRP Capital.

Crypto hedge funds: These are private funds that serve high net worth pre-approved crypto investors to make as much profit for them within the shortest time possible. Most focus on diverse assets apart from crypto. Examples of crypto hedge funds include Pantera, Polychain, Digital Currency Group, Blockchain Capital, and a16z.

Crypto mutual funds, unlike hedge funds, are available to anyone in public and they are supposed to package a collection of digital assets as one investment as investors pull their money together to invest in cryptos and offer shares or stocks to investors. However, most of these funds currently invest in Bitcoin futures and crypto futures contracts.

Crypto exchange-traded funds or ETFs are funds that invest in crypto futures. For instance, the ProShare Bitcoin Strategy ETF and Valkyrie Bitcoin Strategy ETF (the only two available in the United States since 2021) invest in crypto futures contracts like Bitcoin futures and track the price of an underlying asset like Bitcoin.

Crypto mutual funds are similar to exchange-traded funds except that with ETFs, you buy and sell shares like in stocks and their prices fluctuate during the trading day while with mutual funds; you buy and sell dollar amounts. The latter’s price is only affixed per day. Mutual funds charge an expense ratio, which is the fee to invest in it.

An example of a crypto mutual fund is the Bitcoin Strategy ProFund, which invests in Bitcoin futures and not directly in Bitcoin. No funds are currently approved in the U.S. to buy and invest directly in crypto.

Cryptocurrency trusts are investment companies that sell a fixed number of shares to investors, either publicly or privately, and then pull together that money to invest in cryptos. Examples of crypto trusts are the Grayscale Bitcoin Trust, Grayscale Ethereum Trust, and Grayscale Digital Large Cap Fund offered by Grayscale.

Crypto index funds: An index fund is a financial vehicle that pulls together investor funds to invest them in a group of cryptocurrencies based on given criteria, and then offers profits in the form of share dividends or other. Most of these are currently unregulated.

Crypto-adjacent funds are similar to mutual funds and ETFs but they invest in companies that work with cryptocurrencies. Examples include the Amplify Transformational Data Sharing ETF and Reality Shares Nasdaq NexGen Economy ETF.

How to Buy Cryptocurrency ETFs

Crypto ETFs are sold as shares to investors just like normal stocks. If you are looking for how to buy cryptocurrency ETFs, it involves a broker who will buy the shares on the exchange they are listed.

Most won’t be bought directly from the markets unless through a brokerage account with these brokers.

1. Sign up with a broker for that ETF: Brokers that support most of them include Charles Schwab, TD Ameritrade, Fidelity, Vanguard, E-trade, Interactive Brokers, and other trading platforms.
2. Manage an account via a broker.

Crypto Investment Funds FAQs

Q #1) What is the best crypto fund? 

Answer: ProShares Bitcoin Strategy ETF, Grayscale Bitcoin Trust, Grayscale Ethereum Trust, Bitwise 10 Crypto Index Fund, Valkyrie Bitcoin Strategy ETF, VanEck Bitcoin Strategy ETF, and Global X Blockchain & Bitcoin Strategy ETF are some of the best crypto ETFs and investment funds.

These either invest directly in Bitcoin and/or other crypto or in crypto futures and crypto derivative products.

Q #2) Which cryptocurrency EFT is the best? 

Answer: In terms of performance, ProShares Bitcoin Strategy ETF, Valkyrie Bitcoin Strategy ETF, Bitwise 10 Crypto Index, VanEck Bitcoin Strategy ETF, and Global X Blockchain and Bitcoin Strategy ETF. ETFs invest in crypto futures and they expose anyone to Bitcoin without the investors having to trade crypto itself.

Recommended Reading =>> Blockchain ETF Tutorial

Q #3) Are crypto ETFs safe? 

Answer: Since they are licensed to trade, they can be regarded as safe by most people. However, they are also high-risk investments. The investors wouldn’t need to actively hold, trade, and manage the digital currencies in their wallets.

Q #4) How do ETFs work in cryptocurrencies? 

Answer: ETFs work by offering crypto futures contracts that investors can buy and sell to make profits in price differences. These contracts are basically used to speculate the price of the underlying asset, for instance, Bitcoin. The holder agrees to buy or sell a specific amount of an asset at a given time and price.

Please read the list if you are looking for how to buy crypto ETFs.

Unlike most legacy ETFs that track an index or basket of assets, crypto ETFs track one or more digital tokens. It derives value from the price of the underlying assets that it tracks, say Bitcoin prices. The price of a cryptocurrency ETF mimics that of the underlying crypto.

Q #5) Can I start a crypto investment fund? 

Answer: Yes, you would be required to register with the assets securities commission or authorities that govern the trading of securities in your country. Different crypto investment funds are structured differently depending on whether they are ETFs, mutual funds, index funds, trusts, or adjacent funds.

List of Top Crypto ETFs

Popular and Best Crypto Investment Funds list:

1. ProShares Bitcoin Strategy ETF (BITO)
2. Valkyrie Bitcoin Strategy ETF (BTF)
3. VanEck Bitcoin Strategy ETF (XBTF)
4. Grayscale Bitcoin Trust (GBTC)
5. BitWise 10 Crypto Index Fund (BITW)
6. Global X Blockchain & Bitcoin Strategy ETF (BITS)
7. Grayscale Ethereum Trust (ETHE)
8. Amplify Transformational Data Sharing ETF (BLOK)
9. First Trust SkyBridge Crypto Industry and Digital Economy ETF (CRPT)
10. Siren Nasdaq NextGen Economy ETFs
11. First Trust Indxx Innovative Transaction & Process ETF
12. Simplify US Equity Plus GBTC ETF
13. Valkyrie Balance Sheet Opportunities ETF (VBB)
14. Bitwise Crypto Industry Innovators ETF (BITQ)
15. Global X Blockchain ETF (BKCH)
16. Capital Link Global Fintech Leaders ETF (KOIN)
17. VanEck Digital Transformation ETF (DAPP)

Comparison of Best Bitcoin and Cryptocurrency ETFs and Funds

Detailed reviews:

#1) ProShares Bitcoin Strategy ETF

The U.S. ProShares Bitcoin Strategy ETF, which trades under the BITO symbol, launched on October 19 as the first Bitcoin ETF to be approved in the United States. It was a big hit, amassing $1 billion in two days of launching. As one of the best crypto ETFs, it invests in Bitcoin futures and not in spot Bitcoin.

The fund does not involve traders buying futures contracts directly but offers shares to investors. In other words, it pulls investors’ funds together and invests them in these futures while offering shares that accrue dividends for the investors.

In addition to investing in Bitcoin futures contracts, the ETF can also invest in U.S. Treasury Bills and Repurchase Agreements as short-term investment vehicles for cash positions. It can also use leverage.

Features:

• Invests in cash-settled front-month Bitcoin futures. Thus, they have the shortest time to maturity.
• Regulated by the Commodity Futures Trading Commission.

Inception: 19 October 2021
Exchange: NYSE Arca
YTD return: -4.47%
Expense ratio: 0.95%
Asset under management: $1.09 billion
Shares outstanding: 45,720,001
Minimum investment amount: $10,000
Price: $27.93

Website: ProShares Bitcoin Strategy ETF

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#2) Valkyrie Bitcoin Strategy ETF

The Valkyrie Bitcoin Strategy ETF trades under the BTF symbol and is one of the new crypto ETFs launched last year. It was launched three days after the ProShares’ Bitcoin futures ETF went public.

Like BITO, BTF does not invest directly in Bitcoin. Instead, it invested in Bitcoin futures traded on the Chicago Mercantile Exchange through a subsidiary of the Cayman Islands company. Investors do not file K-1 forms with the IRS.

The fund attempts to buy futures contracts equal to 100% of its net assets as much as possible. It then offers shares that investors can buy and sell on the market at the market price. Thus, the investors in BTF invest in the shares of the fund and not in the direct trading of the futures contracts or Bitcoin.

Features:

• For accredited investors.
• No performance fee. The management fee is 0.4%.
• Coinbase custodian.
• Cohen & Company is the auditor.

Inception: 22 October 2021
Exchange: NYSE Arca
YTD return: -10.25%
Expense ratio or fee: 0.95%
Assets under management: $44.88 million
Shares outstanding: 2,800,000
Minimum investment: $25,000
Price: $17.50

Website: Valkyrie Bitcoin Strategy ETF

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#3) VanEck Bitcoin Strategy ETF

Also, one of the new crypto ETFs, the VanEck Bitcoin Strategy ETF or XBTF, is the first U.S.-linked ETF launched on November 15. At a 0.65% expense ratio, it is the cheapest option among the Bitcoin futures ETFs. Like the BTO and BTF, investors buy shares in this fund and they can sell and buy them on the Cboe exchange.

The shares can be traded only through a direct brokerage account with portfolio management and various investment products, and provide freedom and flexibility that allows you to manage the investment. The new crypto ETF and fund is structured like a C-corporation that aims to provide an efficient tax experience for investors.

In addition to investing in Bitcoin futures, it also invests in stocks, bonds, and cash. Parts of the daily holdings include bonds and BTC futures under the ticker symbol BTCH2.

Features:

• Lowest expense ratio or fee so far of just 0.65%.
• Annual distribution frequency.
• Options are available for trading.
• Monthly subscription.
• No performance or redemption fee.
• The U.S. accredited and qualified offshore investors.

Inception: April 2021
Exchange-traded: CBOE
YTD return: -16.23%
Expense ratio: 0.65%
Assets under management: $28.1 million
Minimum investment: $100,000
Price: $43.31

Website: VanEck Bitcoin Strategy ETF

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#4) Grayscale Bitcoin Trust or GBTC

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Launched back in 2013, this fund is not specifically an ETF but aims to convert to an ETF as soon as it is allowed. Instead of being a futures ETF, it aims to be a spot ETF in that it will invest in spot ETFs.

Spot ETFs involve Bitcoin settlements at the end of the contract expiry instead of being cash-settled. While it offers shares to invest in it, the trust holds and trades real Bitcoin.

Grayscale, a subsidiary of a New York venture fund called Digital Currency Group, also runs other trusts for other cryptos. These include the Grayscale Ethereum Trust with about $9 billion in assets under management, Grayscale Chainlink Trust, and Grayscale Stellar Trust.

DCG has also invested in Coinbase, Coindesk, and Dapper Labs, and is the creator of CryptoKitties.

Features:

• Allows people’s exposure to Bitcoin without having to hold, trade, and manage the actual cryptocurrency. They do not need to learn or know how to do it.
• Invest directly in Bitcoin.
• Largest Bitcoin fund so far.

Inception: 2013
Exchange: OTCQC is operated by OTC Markets
YTD return: 13%
Expense ratio: 2%
Assets under management: $26.44 B
Shares Outstanding: 692,370,100
Minimum investment: $50,000
Price: $30.51

Website: Grayscale Bitcoin Trust or GBTC

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#5) BitWise 10 Crypto Index Fund (BITW)

BITW is an index fund focused on the 10 most valuable cryptocurrencies instead of just Bitcoin. To determine the 10 assets, the fund considers risks, weighs the holdings by market capitalization, and rebalances the fund monthly.

Investing in many cryptos is one of the greatest alternatives to diversification, although some other funds invest in Bitcoin and diversify with stocks, bonds, and other assets.

The fund is categorized as a partnership and therefore investors receive a K-1 at the end of the year. A K-1 can complicate and add to the cost of an investor’s annual income tax accounting.

Features:

• Managed funds.
• Trades over the counter at wide discounts.
• No sales charges or other fees.

Inception: 2017
Exchange: OTCQX Market
YTD return: -16.28%
Expense ratio: 2.5%
Asset under management: $880 million
Shares Outstanding: 20,241,947
Minimum investment: $10,000
Price: $31.94

Website: BitWise 10 Crypto Index Fund (BITW)

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#6) Global X Blockchain & Bitcoin Strategy ETF (BITS)

Trading under the ticker symbol BITs, this is Global X’s second ETF relating to blockchain. In addition to investing in Bitcoin, the new crypto ETF invests in blockchain-related equities found in BKCH. These equities include companies involved in mining cryptocurrencies, exchanges, and trading platforms, as well as those dealing in software services.

It captures the interests of investment advisers, most of who would rather advise to invest in stock than crypto ETFs. However, it also addresses the concerns of traders who prefer futures-only ETFs. Investing in futures contracts serves this purpose.

Features:

• Third-and-fourth month futures. These cost about 5% to roll annually. These make up half of the portfolio. In comparison, the ProShares Bitcoin ETF, for instance, costs 10-15% in roll costs.
• 0.82 daily correlation to spot Bitcoin. Compare this to BITO’s 0.99 daily correlation to spot Bitcoin.
• 50% allocation to futures contracts means it provides a better correlation to spot Bitcoin than blockchain equity ETFs or stocks like microstrategy.

Inception: 15 November 2021
Exchange: Nasdaq
YTD returns: -12.93%
Expense ratio: 0.65%
Assets under management: $7.8 million
Minimum investment: $25,000
Shares Outstanding: 460,000
Price: $17.70

Website: Global X Blockchain & Bitcoin Strategy ETF (BITS)

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#7) Grayscale Ethereum Trust (ETHE)

Grayscale Ethereum Trusts invests directly in Ethereum cryptocurrency, and the assets are stored in cold storage owned by the Coinbase exchange. The fund provides exposure to Ethereum through shares that can be traded on the OTCQX. The latter is a marketplace operated by the OTC Markets and registered with the Security Exchange Commission.

Ideally, the ETF fund tracks the CoinDesk Ether Price Index from which it draws value for the share. The share redemptions are currently not authorized. Individuals who invest in the shares can invest in IRA accounts through the fund. This can be done through Pacific Premier Trust, Millennium Trust, The Entrust Group, and Alto IRA.

Inception: 14 December 2017
Exchange: OTCQX Market
YTD return: -17.08%
Expense ratio: 2.50%
Assets under management: $9.04 billion
Minimum investment: $25,000
Shares Outstanding: 310,158,500
Price: $26.16

Website: Grayscale Ethereum Trust (ETHE)

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#8) Amplify Transformational Data Sharing ETF (BLOK)

The Amplify Transformational Data Sharing ETF is an actively managed fund conceived in 2018. The fund provides returns by investing at least 80% of net assets, including borrowings inequities. The equities invested must be from companies developing and utilizing blockchain transformational data-sharing technologies.

Being actively managed means it can respond to markets with a real-time change in the portfolio. The remaining 20% is invested in companies that partner with BLOK. It doesn’t itself invest in blockchain or crypto technologies. It breaks the portfolio based on a few criteria – 43.7% in large companies, 26.7% in mid-cap companies, and 29.7% in small-cap companies.

Features:

• The shares can be traded primarily on the New York Securities Exchange Arca.
• Transparent structure.

Inception: 2018
Exchange: New York Securities Exchange Arca
YTD return: 62.64%
Expense ratio: 0.70%
Assets under management: $1.01 billion
Minimum investment: Not available
Shares Outstanding: 27 million
Price: $35.26

Website: Amplify Transformational Data Sharing ETF (BLOK)

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#9) First Trust SkyBridge Crypto Industry and Digital Economy ETF (CRPT)

CRPT is listed and traded on the NYSE Arca. The fund, which is actively managed by managers at SkyBridge, launched in September 2021 and invests 80% of its assets in companies active in the crypto economy.

The companies and the fund invests in have at least 50% of exposure to crypto. The company must derive its revenue and profits directly from services performed, goods produced, or investments made in the crypto industry.

Features:

• The fund is domiciled in the United States. Stock selection is guided by bottom-up research done by SkyBridge.
• 50% of the fund is invested in companies directly dealing with or providing crypto goods, services, or investments. The other 50% is invested in companies with at least 50% direct investment, good production, or services performed in the digital economy.

Inception: 20 September 2021
Exchange: NYSE Arca
YTD returns: -32.71%
Expense ratio: 0.85%
Assets under management: $41 million
Minimum investment: Not available
Shares Outstanding: 3.9 million
Price: $14.19

Website: First Trust SkyBridge Crypto Industry and Digital Economy ETF (CRPT)

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#10) Siren Nasdaq NextGen Economy ETFs

The Siren Nasdaq NextGen Economy ETF, which trades under the ticker BLCN tracks the performance of the Nasdaq Blockchain Economy Index. The index comprises stocks that support blockchain technology or use it for their business.

The fund is reasonably diversified, with 20% of overall assets held in the top 10 holdings. Some of the top holdings are Marathon Digital Holdings, Coinbase, Ebang International Holdings, Microstrategy, Canaan, American Express, Hewlett Packard, IBM, and HPE.

Most of the holdings are in technology, financials, and communications. 53% of the fund’s assets are held in the United States, followed by Japan and China.

Features:

• Offers shares that can be traded on stock markets.
• Passively managed funds.
• Non-diversified fund.

Inception: 17 January 2018
Exchange: Nasdaq
YTD return: -9.52%
Expense ratio: 0.68%
Assets under management: $200.30 million
Minimum investment: Not available
Shares Outstanding: 5,200,000
Price: $34.45

Website: Siren Nasdaq NextGen Economy ETFs

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#11) First Trust Indxx Innovative Transaction & Process ETF

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The First Trust Indxx Innovative Transaction & Process ETF trades under the ticker LEGR and is a passively managed ETF that tracks the Indxx Blockchain Index. The index, in turn, follows companies with a connection to blockchain investments. It researches and weighs the holdings before investing in them.

The holdings are evaluated based on a specific size, liquidity, and trading minimums.

Features:

• The portfolio has a cap of 100 stocks.
• It is reconstituted and rebalanced twice a year.

Inception: 17 February 2011
Exchange: Nasdaq
YTD return: -32.71%
Expense ratio: 0.65%
Assets under management: $134.4 million
Minimum investment: Not available
Shares Outstanding: 3.7 million
Price: $76.09

Website: First Trust Indxx Innovative Transaction & Process ETF

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#12) Simplify US Equity Plus GBTC ETF

Simplify US Equity Plus GBTC ETF or SPBC provides an efficient way for asset allocators who want to add exposure to BTC to their portfolios. For that reason, it invests in US stocks and at the same time invests in Grayscale Bitcoin Trust to provide a 10% exposure to BTC. The fund was launched in May 2021.

Features:

• Domiciled in the United States.
• Public and open-ended investment company.

Inception: 24 May 2021
Exchange: Nasdaq
YTD return: -5.93%
Expense ratio: 0.74%
Assets under management: $108,859,711
Minimum investment: Not available
Shares Outstanding: 4,200,001
Price: $26.27

Website: Simplify US Equity Plus GBTC ETF

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#13) Valkyrie Balance Sheet Opportunities ETF (VBB)

Valkyrie Balance Sheet Opportunities ETF is an actively managed fund that invests in innovative companies with exposure to Bitcoin. It invests at least 80% of assets plus borrowings in these companies. Its top 10 holdings are Microstrategy Inc, Tesla, Block, Coinbase, BTCS, Mastercard, Riot Blockchain, Globant, Marathon, and Mogo.

According to the website, the company uses different valuation methods to evaluate its investment on a continuing basis. The evaluation methods are based on United States accounting principles.

Features:

• Shares are tradable at the Nasdaq exchange.
• Globally available.
• The company has many other funds one can invest in

Inception: 14 December 2021
Exchange: Nasdaq
YTD return: -12.41%
Expense ratio: 0.75%
Assets under management: $528,000
Minimum investment: Not available
Shares Outstanding: 25,000
Price: $21.08

Website: Valkyrie Balance Sheet Opportunities ETF (VBB)

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#14) Bitwise Crypto Industry Innovators ETF (BITQ)

The ETF or index invests in companies involved in the crypto economy. These include crypto stocks and not coins. The companies include mining firms, equipment suppliers, financial services, and crypto-related clientele.

Inception: 11 May 2021
Exchange: NYSE Arca
YTD return: -31.49%
Expense ratio: 0.85%
Assets under management: $128.22 million
Minimum investment: Not available
Shares Outstanding: 7,075,000
Price: $17.72

Website: Bitwise Crypto Industry Innovators ETF (BITQ)

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#15) Global X Blockchain ETF (BKCH)

The Global X Blockchain ETF (BKCH) invests in companies that deal in blockchains and digital asset transactions, integration applications and services, integration hardware, dApps, and hardware. Top holdings in the actively managed fund include Coinbase, Riot Blockchain, Marathon Digital mining firm, Galaxy Digital, and Canaan.

Inception: 2021
Exchange: NYSE
YTD return: 10.50%
Expense ratio: 0.50%
Assets under management: $119.53 million
Minimum investment: Not available
Shares Outstanding: 6,500,000
Price: $17.83

Website: Global X Blockchain ETF (BKCH)

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#16) Capital Link Global Fintech Leaders ETF (KOIN)

The Capital Link Global Fintech Leaders ETF (KOIN) fund tracks the AF Global Fintech Leaders Index to identify investment opportunities in Fintech companies. Its portfolio involves companies that create and provide digital assets or optimize settlements, and those using technology to provide financial services.

80% of the fund is invested in the securities of this index.

Inception: 30 January 2018
Exchange: NYSE
YTD return: -7.58%
Expense ratio: 0.75%
Assets under management: $25.1 million
Minimum investment: Not available
Shares Outstanding: 625,000
Price: $39.94

Website: Capital Link Global Fintech Leaders ETF (KOIN)

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#17) VanEck Digital Transformation ETF (DAPP)

The VanEck Digital Transformation fund tracks the performance of the MVIS Global Digital Assets Equity index, which in turn tracks the performance of companies in the digital economy. The fund then invests in companies involved in digital transformation.

These include diversified exposure to digital currency exchanges, mining firms, and other infrastructure companies. It is rebalanced quarterly. The custodians of the fund are State Street Bank and Trust Company.

Inception: 12 April 2021
Exchange: Nasdaq
YTD return: -7.58%
Expense ratio: 0.5%
Assets under management: $61.9 million
Minimum investment: Not available
Shares Outstanding: 4 million
Price: $39.94

Website: VanEck Digital Transformation ETF (DAPP)

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Conclusion

In conclusion, this tutorial dwelt on crypto or Bitcoin ETFs. Most ETFs invest in Bitcoin futures and others in crypto and blockchain stocks. For ETFs investing in startups and companies’ stocks, a focus on blockchain appears to be yielding more from ETFs than ETFs with other focuses.

We saw that the ProShares Bitcoin ETF and Valkyrie Bitcoin Strategy ETF are probably the most famous Bitcoin ETFs, each having amassed over $1 billion in days of starting, trading in the United States’ most famous stock exchanges, and charging more affordable fees than most famous trusts.

But Grayscale’s Bitcoin Trust and Grayscale Ethereum Trust are the largest crypto funds we have so far, at $26 and $9 billion, respectively.

The cheapest are The Global X Blockchain ETF (BKCH) and VanEck Digital Transformation at an expense ratio of 0.5% each.

The First Trust Indxx Innovative Transaction & Process ETF, The Siren Nasdaq NextGen Economy ETF, Amplify Transformational Data Sharing ETF, Global X Blockchain & Bitcoin Strategy ETF, and the VanEck Bitcoin strategy ETF are also among the cheapest at under $0.70 expense ratio each.

Research Process:

• Time is taken to research the article: 20 hours
• Total tools researched online: 25
• Total tools shortlisted for review: 17