Understanding Cryptocurrency ETF

Posted by on Aug 9, 2018

Understanding Cryptocurrency ETF

ETF or exchange-traded funds is where the assets are traded on the exchange. This is an investment fund and is traded just like you would trade any traditional stock. This means that the investor can trade the ETF on the stock exchange. It also means that they can buy and sell theETF directly on the exchange.

The main thing about an ETF fund is that it is cheaper than the mutual funds. This is because ETF is an index tracking fund that is passively traded. Trading ETF is beneficial to investors because it lets them trade in the different market niche as well as-as into different asset classes which normally would be difficult to invest into.

Bitcoin ETF

In a Bitcoin ETF, the underlying asset that is traded is Bitcoin. Buying a Bitcoin ETF is when you are purchasing a Bitcoinhoweverindirectly. The Bitcoin ETF tracks the Bitcoin prices in real time. The advantage of trading in Bitcoin ETF is that you do not need to buy and store the Bitcoin.

What are the benefits of trading Bitcoin ETF?

Bitcoin traded as an ETF has many benefits. Bitcoin trading is complex, to begin with; however, by allowing trading in Bitcoin ETF, the cryptocurrency becomes more tradable by a wide range of investors.

This gives the investors the flexibility to trade in Bitcoin which they were unable to do earlier. Now they can trade in Bitcoin-like they would trade any mutual fund. This calls even the beginner cryptocurrency traders to take advantage of the Bitcoin price movements. And in turn, more participants means more activity is Bitcointradingwhichwill cause the price to surge.

Investing in Bitcoin ETF

All that you need to do to start trading in Bitcoin ETFon, see this, is to open an account with your broker. Once you open the account you need to deposit money into the account. Go to the tab that allows you to trade and select a Bitcoin ETF.

You can now buy any number of Bitcoin ETF’s as you wish to. Make sure that you key in the right details and then proceed with the transaction.

Trading in Bitcoin ETF saves you from having any crypto wallet or any digital wallets. This means that you do not have to bother a lot about security and storing your coins when you trade Bitcoin ETF.

If you are just starting to trade in Bitcoin then trading Bitcoin ETF could be a better option.