Everything you need to know on Bitcoin ETFs January 22, 2025
Bitcoin is ever-evolving. Here’s an update of spot Bitcoin ETFs AUM after Donald Trump inauguration on 20th Jan 2025. This article was first published on 11th Jan 2024.
| Name | Ticker | Issuer | AUM* | Mgmt Fee (before any waiver) | Exchange |
| iShares Bitcoin Trust | IBIT | BlackRock | 59.045B | 0.25% | Nasdaq |
| Grayscale Bitcoin Trust (conversion) | GBTC | Grayscale | 21.31B | 1.5% | NYSE |
| Fidelity Wise Origin Bitcoin Trust | FBTC | Fidelity | 22.26B | 0.25% | CBOE |
| ARK 21Shares Bitcoin ETF | ARKB | ARK Invest & 21Shares | 5.20B | 0.21% | CBOE |
| Bitwise Bitcoin ETP Trust | BITB | Bitwise | 4.48B | 0.20% | NYSE |
| VanEck Bitcoin Trust | HODL | VanEck | 1.50B | (Waived till Jan 2026) | CBOE |
| Valkyrie Bitcoin Fund | BRRR | Valkyrie | 926.73M | 0.25% | Nasdaq |
| Invesco Galaxy Bitcoin ETF | BTCO | Invesco & Galaxy | 816.87M | 0.25% | CBOE |
| Franklin Bitcoin ETF | EZBC | Franklin | 796.87M | 0.19% | CBOE |
| WisdomTree Bitcoin Trust | BTCW | WisdomTree | 420.94M | 0.25% | CBOE |
| Hashdex Bitcoin ETF | DEFI | Hashdex | 16.62M | 0.9% | NYSE |
Updated as of 21 Jan 2025
This article aims to give you the facts and insights into the hotly discussed Bitcoin ETFs.
Let’s look back on the development of Bitcoin to today’s US SEC approval of Bitcoin spot ETF together!
Brief History of Bitcoin & Cryptocurrency
2008: An individual named “Satoshi Nakamoto” introduces the concept of Bitcoin.
2009:The Bitcoin network goes live, and mining of the first block occurs.
2010:Bitcoin sees its first documented transaction.
2011: Other alternative cryptocurrencies emerge.
2013: Bitcoin value reaches US$1,000 for the first time.
2014: The collapse of a significant cryptocurrency exchange, Mt Gox, shifts focus to alternative cryptocurrencies.
2017: Bitcoin price approaches US$20,000 but drops around 75% in value by year- end.
2018: A significant market downturn affects Bitcoin’s value.
2020: Despite wide fluctuations, Bitcoin’s value sees considerable growth.
2021: Bitcoin achieves a new price milestone of US$69,045. Regulatory bodies approve crypto-related products, despite a 64% drop in value.
2022: The crypto sector sees increased institutional interest and a growth in decentralized finance and digital collectibles.
2023: Blockchain technology advances. Countries explore digital fiat currencies.Regulatory scrutiny of cryptocurrencies intensifies.
2024: On 10 Jan 2024, the SEC approves 11 spot Bitcoin ETFs, marking a significant step in integrating cryptocurrencies into mainstream finance. However, concerns about Bitcoin’s volatility remain.
2025: On 17 Jan 2025, President Trump introduced a meme coin named $TRUMP through his company, CIC Digital LLC, while this move garnered significant attention, it also faced criticism from ethics experts, who raised concerns about potential conflicts of interest. The inauguration of Donald Trump as the 47th president of the United States took place on 20 January 2025, Monday.
Background and Significance of Bitcoin Spot ETFs
Bitcoin Spot ETFs mark a pivotal advancement in the realm of cryptocurrency investment. These Exchange-Traded Funds provide investors with the opportunity to gain exposure to Bitcoin’s value without the need of direct ownership. Initially, Bitcoin investment was accessible through futures-based ETFs like BITO, which invested in Bitcoin futures contracts, focusing on future prices. Subsequently, trust-based ETFs such as GBTC emerged, holding actual Bitcoin for indirect ownership, simplifying the investment process.
The latest stride forward is the introduction of spot ETFs. Unlike futures-based ETFs, spot ETFs hold actual Bitcoin, allowing them to more accurately reflect the cryptocurrency’s real-time market price. This development is similar to the introduction of gold ETFs in the early 2000s, which simplified and broadened access to gold investment. Bitcoin spot ETFs allow easy investment through a brokerage account, making Bitcoin more accessible to a wider audience.
Pros and cons of ETF for Bitcoin:
Pros:
1. Increased Accessibility:
A Bitcoin spot ETF makes investing in Bitcoin accessible to anyone with a brokerage account.
2. Lower Cost:
Investing in ETFs is generally more cost-effective. For example; investing in a Gold ETF incurs lower cost compared to physically buying and holding gold.
3. Diversified Portfolios:
Investors can diversify their portfolios without the need to directly purchase Bitcoin.
4. Regulated Framework:
Spot ETFs provide a more regulated investment environment
5. Enhanced Liquidity:
They increase the liquidity of Bitcoin investments by potentially attracting more market participants to the stock exchange
Cons:
1. Limited Exposure:
Investors only gain exposure to Bitcoin’s price, rather than a diversified portfolio of cryptocurrencies
2. Market Volatility:
Bitcoin’s price exhibits high volatility, which may not be suitable for everyone.
3. Regulatory Challenges:
The legal status of cryptocurrency is still evolving, posing potential risks.
4. Uncertain Future:
The long-term utility and acceptance of Bitcoin remain uncertain.
5. Lack of Asset Backing:
Unlike traditional investments such as stocks or real estate, Bitcoin lacks intrinsic value or physical backing, This characteristic makes it more speculative and dependent on market sentiment
Trading Bitcoin ETFs
Trading Bitcoin ETFs involves following certain rules, like completing the Customer Account Review (CAR), Risk Warning Statements and W8 Form (for US market trading). These steps ensure investors understand the risks and know what they’re getting into.
Conclusion
Bitcoin continues to experience growth as it attracts increasing interest and becomes more accessible to a wider range of investors. Furthermore, recent support for digital tokens, such as President Trump’s endorsement, has contributed to heightened interest in cryptocurrencies.
However, it is important to approach this trend with caution. Bitcoin’s inherent volatility and the evolving regulatory landscape surrounding cryptocurrencies present significant risks. While Bitcoin spot ETFs mark a noteworthy advancement in the market, they also carry the complexities and speculative nature of the underlying asset.
Investors are encouraged to carefully evaluate these factors and conduct thorough research to fully understand the potential implications of investing in Bitcoin or related ETFs. Any investment decision should align with individual financial objectives, risk tolerance, and a well-informed assessment of current market conditions.
What to do next
Stay informed and connected. Ask questions on POEMS Mobile 3 “All About ETFs” community.
Additional Risk Disclosure Statement for Payment Token Derivatives (“PTDs”)
Trading in PTDs such as cryptocurrency funds or ETFs, cryptocurrency CFDs or debentures that reference payment tokens carries a high level of risk. The Customer may risk losing all the Customer’s capital or more. The Customer must therefore be fully aware of the following risks associated with both derivatives and payment tokens/cryptocurrencies and carefully assess whether an investment in PTDs or cryptocurrencies is suitable for the Customer’s investment objectives and risk appetite:
- Cryptocurrencies are not legal tender and are not issued by any government nor backed by any asset or issuer. Cryptocurrencies are currently not subject to any regulatory requirements or supervisory oversight by the Monetary Authority of Singapore (MAS). Hence the safeguards afforded under MAS’ regulatory framework may not apply to consumers dealing with unregulated products;
- Cryptocurrencies have little or no intrinsic value, making them hard to value and are extremely volatile. Being highly speculative, investing in them entails high risk as prices are prone to sudden sharp swings as a result of unanticipated events or changes in market sentiments primarily due to the lack of price transparency;
- Liquidity may also become limited and price gaps may occur in such circumstances;
- Cryptocurrency exchanges, where cryptocurrencies are bought and traded, may be susceptible to cyber security breaches. In the event of a cyberattack and theft of cryptocurrencies, it may result in drastic, adverse price movements.
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About the author
ETF Desk
The ETF Desk is part of the Global Markets Team of Phillip Securities. The ETF Desk is responsible for the ETF business of Phillip Securities. The desk works closely with ETF issuers for distribution purposes, and on curating educational materials to retail investors such as seminars, webinars, market journal and video production.
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