Why Cryptocurrency Exchange-Traded Funds Redefine The Future?

Why Cryptocurrency Exchange-Traded Funds Redefine The Future?


The domain of cryptocurrency ETFs is observing a renewed interest from people all around the world. One approval for a Canadian Bitcoin ETF is enough to take things to the next level. Cryptocurrency ETFs remain as an attempt to mix cryptocurrencies with the traditional funds we invest in nowadays. Cryptocurrencies could now benefit from other supplies flowing within the economy. However, it is crucial to know whether these cryptocurrency Exchange-Traded funds have a future or not. After all, we may invest in them at some point. Let’s peek into the future of crypto ETFs from this article. 


Cryptocurrency Exchange-Traded Funds And Their Future


When 2021 began, we observed the Ontario SEC giving approval to the first-ever Bitcoin ETF in Canada. Now Bitcoin is chosen to combine with the funds because this crypto is the most accepted one. Almost every country realizes its capability to eliminate third parties during transactions. Bitcoin is somewhat slower than the other cryptocurrencies. However, when it comes to adoption, it is at the top. Many companies are adopting Bitcoin by allowing users to pay for using their products and services. Microsoft and Expedia are the two among a list of companies accepting Bitcoins. Also, the number of companies is increasing. 


Among several cryptocurrency ETF funds, only one having an association with the retail sector is chosen in Canada. With this ETF, the largest cryptocurrency would get exposure via BUT, TD Ameritrade, and others. BUT and TD Ameritrade are the best retail trading apps within the region. Traders following the ETFs will not purchase Bitcoin. Instead, they will spend on Bitcoin without setting up their crypto wallets. That also indicates traders could now protect themselves from extreme volatility in the market. Any best cryptocurrency ETF could spark a bull run in the market, as many experts have started believing that.  


The US SEC earlier rejected the idea of Bitcoin combining with the traditional funds. The regulator has been active in monitoring Bitcoin ETFs and their offerings since 2017. Crypto enthusiasts lost hope at that time. So, if it is not the USA, it is Canada to receive the first Bitcoin ETF approval. Although the future markets are partnering, they have not developed themselves according to the rules and regulations. The SEC is looking to give approval if Bitcoin gets successful in holding about $3 trillion in the market. And that does not seem to happen during the given market conditions. 


Many crypto entrepreneurs are having their opinions. Matthew Hougan, a renowned personality in the crypto domain, clears that the market should be efficient enough to comply with the evolving perceptions of the regulating authority. Besides this, there should be a certain number of crypto custodians offering their valuable support to the people. A primary issue is that there are few or no custodians available for cryptocurrencies. Custodians play a crucial role when funds combine with cryptocurrencies. Given that the approval in Canada is a positive indication, the number of custodians may increase with the region. We could witness others from neighbouring countries in the line. 


How Is Bitcoin ETF Different From Bitcoin?


Spending on Bitcoin ETF and doing it with Bitcoin are different things. You do not involve yourself with a middle-man while investing in Bitcoin itself. You approach an exchange platform, buy the crypto and HODL it. However, with Bitcoin ETF, you are involved with the issuer managing the funds. No need to worry about how the market is performing. All the mess goes to the fund providers. Many people have already started investing in Bitcoin ETFs, and consequently, ETFs hold billions of dollars in the market. Generally, when investing in the ETF, you deal with the providers rather than the crypto exchange platforms.


Crypto enthusiasts also believe that someone investing in cryptocurrency ETF funds could get the tax benefits. That is also a reason why people are choosing ETFs over cryptos. Short selling also gets easy as a Bitcoin ETF is considered an investment vehicle. The price may go down in the forthcoming months. On the other hand, when you invest in Bitcoin, short selling may be tricky, depending on the given time. As the number of custodians increases, we could see more and more ETFs arriving before us. Other cryptocurrencies may also get added with these ETFs in the next coming years.   




Cryptocurrency Exchange-Traded Funds or cryptocurrency ETFs really redefine the future of investments. The market needs some volatility together with reliability at the same time. Until now, stablecoins are standing their ground against volatility. However, they are not as profitable as Bitcoin ETFs. Crypto ETFs need approval in several countries, including the USA. The regulators are strict for the welfare of the investors as well as the economy. Only after examining these ETFs thoroughly, they could make further decisions. Many people are voicing their opinions in the favour of cryptocurrency ETFs. A glorious era may finally come for them.


Author Since: July 4, 2021

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