Best Bitcoin ETFs in Canada

The Best Bitcoin ETFs in Canada

On February 11, 2021, Canada was the first and only country in North America to allow a new financial investment product to enter the market.

Known as the Bitcoin ETF, these are like regular exchange traded funds, except they are indexed to the value of the bitcoin cryptocurrency instead of the value of various securities or other commodities like precious metals or art and collectibles.

Therefore, Bitcoin ETFs are traded not on a crypto exchange, but on the Toronto Stock Exchange, each with their own Bitcoin ETF Canada ticker symbol.

Below we run down the best of these new Bitcoin ETFs and teach you how to buy Bitcoin ETF in Canada. However, you should know that Bitcoin ETF in Canada is so new that the performance of each of these ETFs for investors won’t be revealed until they spend at least a year on the market.

None the less, it’s still worth it to see what a Bitcoin ETF in Canada looks like.

Table of Contents

The Best Canadian Bitcoin ETFs

QuestradeLogo
Start investing today with a complimentary $50 in free trades for any account activation of $1,000 or more.
WealthsimpleLogo
  • User friendly platform for Canadians
  • $50 sign up bonus when you fund your invest account with $500

1. Purpose Bitcoin ETF (BTCC)

Ticker Symbol: TSX – BTCC

MER: Capped at 1.50%

Listed Currency: CAD & USD

Assets Under Management: $1.65 billion

Cold Storage Wallet: 100%

Management Fee: 1.00%

Eligible Accounts:  TFSA, RRSP, personal and corporate non-registered accounts.

The Purpose Bitcoin ETF was the first Bitcoin ETF launched anywhere in the world when it arrived in February 2021 and a year later, it remains the standard bearer for this new investment vehicle. It passed $1 billion in assets under management after only a month on the market and continues to grow to new heights to this day. It is also the first Bitcoin ETF to keep all of its assets in cold storage, which means offline and away from potential hackers. Of course, it is invested in a single asset and isn’t diversified among many cryptocurrencies, which still makes it a risky investment.

2. 3iQ CoinShares Bitcoin ETF (BTCQ)

Ticker Symbol: TSX – BTCQ

MER: 1.25%

Listed Currency: CAD & USD

Assets Under Management: $1.14 billion

Cold Storage Wallet: 100%

Management Fee: 1.00%

Eligible Accounts: RRSP, RIFF, RDSP, DPSP, RESP, TFSA, personal and corporate non-registered accounts.

This Bitcoin ETF established in March 2021 was developed by a partnership between 3iQ Digital Asset Management and Coinshares. It has the same MER as BTCC above, (1.00%) but is capped lower at 1.25% rather than 1.50% like the Purpose Bitcoin ETF. It is available for both registered and non-registered accounts.

3. Evolve Bitcoin ETF (EBIT)

Ticker Symbol: TSX – EBIT

MER: 0.75%

Listed Currency: CAD & USD

Assets Under Management: $106.68 million

Cold Storage Wallet: 100%

Management Fee: 0.75%

Eligible Accounts: TFSA, RRPS, personal and business taxable accounts.

Evolve holds the distinction of coming in second place. As in, it launched a week after the Purpose Bitcoin ETF did. It also set its fees to 0.75%, making it much cheaper than its initial competition right off the bat. Unfortunately, this hasn’t made them as successful or popular as the Purpose Bitcoin ETF yet.

4. CI Galaxy Bitcoin ETF (BTCX)

Ticker Symbol: TSX – BTCX

MER: capped at 0.95%

Listed Currency: CAD & USD

 Assets Under Management: $525.6 million

Cold Storage Wallet: 100%

Management Fee: 0.40%

Eligible Accounts: RRSP, RRIF, TFSA, RESP, RDSP, DPSP, personal and corporate non-registered accounts.

The CI Galaxy Bitcoin ETF was launched as a partnership between CI Investments and Galaxy Digital Capital Management LP. It is the best Bitcoin ETF in terms of having the lowest management fee available at 0.40% with many of the same qualities. It is available for both registered and unregistered accounts.

5. Ninepoint Bitcoin ETF (BITC)

Ticker Symbol: TSX – BITC

MER:  capped at 1.45%

Listed Currency: CAD & USD

Assets Under Management: $54.04 million

Cold Storage Wallet: 100%

Management Fee: 0.70%

Eligible Accounts: RRSP, RRIF, TFSA, RESP, RDSP, DPSP

Ninepoint Bitcoin ETF is a closed fund that has been turned into an ETF that is marketed as an environmentally friendly way to invest in Bitcoin, since mining Bitcoin is known to take tons of electric energy.  Ninepoint claims to pay for the carbon it produces when mining the Bitcoins in the fund with its management fee of 0.70%. Still, investors should exercise caution here as Ninepoint is a Bitcoin ETF with a high-risk investment rating.

*All figures as of January 2022

What is a Bitcoin ETF?

A Bitcoin ETF is an exchange traded fund that isn’t tracking a stock index such as the S&P 500 or NASDAQ (mimicking that price) but instead is indexed to the price of Bitcoin (mimicking that price). This way, investors can invest in the value of Bitcoin without trading in the actual currency itself using a more traditional, longstanding and trusted investment vehicle.

What is the difference between a Bitcoin ETF and Bitcoin?

Bitcoin is a digital currency with a real value produced by solving complex computational puzzles on the blockchain, but a Bitcoin ETF is an exchange traded fund that follows the value of Bitcoin currency owned by the fund in question. While traditional ETFs follow the indexed value of stocks, bonds or commodities on the market, a Bitcoin ETF follows the indexed value of Bitcoin as a digital asset and traded commodity.

Bitcoin ETFs Pros & Cons

Pros: The Good Stuff

Logo Bitcoin ETFs are a safer and easier investment than Bitcoin itself, as buying Bitcoin means the investor must manage the currency’s storage and security themselves.

LogoBitcoin ETFs shield investors from the risks of investing in Bitcoin directly by allowing them to invest in Bitcoin indirectly.

Logo Investing in Bitcoin ETFs allow you to trade on traditional exchanges and you don’t have to trade on a cryptocurrency exchange.

Logo You can short-sell a Bitcoin ETF, but not Bitcoin itself, so Bitcoin ETFs allow investors to attempt to profit when the price of Bitcoin goes down.

Cons: The Not So Good Stuff

Logo Bitcoin ETFs have management fees you must pay.

Logo You cannot trade the Bitcoin in an ETF for other cryptocurrencies.

Logo Bitcoin ETFs may not accurately track the price of their Bitcoin index due to Bitcoin’s constant price volatility as a currency.

How to buy Bitcoin ETFs in Canada

Questrade

Though Questrade doesn’t allow you buy Bitcoin straight-up, you can buy Bitcoin ETFs in the same way you can buy traditional ETFs. After opening a Questrade account and registering the account online with your personal details, e-mail and password, simply search for the Bitcoin ETF you want and click “Buy.” Then, select the type of account in your portfolio you want the Bitcoin ETF to be a part of. Finally, specify the type of order you want to conduct and how many shares of the Bitcoin ETF you want before reviewing the order, including its cost, and confirming it for processing.

Weathsimple Trade

Wealthsimple Trade does allow you to buy Bitcoin and Ethereum outright, but you can also purchase Bitcoin ETFs. Buying a Bitcoin ETF from Wealthsimple Trade is basically the same as buying a Bitcoin ETF from Questrade in the sense that once you set up an account, just search for the ETF you want in the search bar, select it, fill in the order details such as what account you want it in and how many shares of the ETF you want to buy, review the order details, including cost and then confirm the order for processing.

How to buy Bitcoin ETFs in Canada on an Exchange

Cryptocurrency exchanges such as BitBuy offer investors an opportunity to buy Bitcoin ETFs along with various cryptocurrencies. All you have to do is sign-up for an account, verify your identity and start trading. Once you can trade, just search for the Bitcoin ETF you’re looking for, put it in your selected investment account and select how many shares you want. Then, confirm the trade and pay the fees.

The Bottom Line

If you’re interested in Bitcoin as a potentially lucrative investment, but don’t want to actually trade the currency itself out of concern for keeping it secure and its reputation for great volatility, Bitcoin ETFs are a good indirect option if you want some investment exposure to Bitcoin as a means of diversifying your portfolio, but don’t want to be responsible for the stewardship of the currency itself.

Frequently Asked Questions

Bitcoin ETFs are a safer investment than investing in Bitcoin directly because you don’t need to deal with cryptocurrency exchanges and their potential for being hacked, nor do you need to invest in a hardware cryptocurrency wallet just to make sure your Bitcoin doesn’t get stolen or suddenly disappear, never to be recovered. With Bitcoin ETFs all of that responsibility is shifted to the fund you’re invested in, so if anything were to happen, you are someone shielded. These funds are insured and by investing in a Bitcoin ETF, instead of Bitcoin, you are able to invest on already tried and true exchanges like the TSX. Also, your financial advisor will have access to it, so they can help you invest and diversify your portfolio.

Even though a Bitcoin ETF may have trouble accurately tracking the price of Bitcoin because its price is so notoriously up and down, it is less risky than investing in Bitcoin directly because many of the risks that come with investing in Bitcoin are managed by the fund itself and not the investor in the case of a Bitcoin ETF. These risk factors include the security of the Bitcoin, the understanding of Bitcoin and all that goes into it, and the ability to trade in traditional markets rather than the unregulated entities that are cryptocurrency exchanges. Bitcoin ETFs allow you to see what Bitcoin is all about and indirectly invest in it without suffering through the ups and downs of the actual currency.

Purpose Bitcoin ETF is the first and by far most popular Bitcoin ETF in Canada and anywhere else in the world with $1.26 billion in assets under management. It's probably the one you should go with just on that basis alone. However, to call it the best from a performance standpoint is difficult because no Bitcoin ETF on the market will release their prospectus in terms of how the fund has performed for investors until it has spent a year on the market and, as of this writing, Purpose Bitcoin ETF is still one month away. In fact, the Bitcoin ETF concept is so new that all of the options on this list are in the same boat. None of them have been on the market for a full calendar year, so their performance hasn't been made public. Of course, there's a few with lower fees, so if that's your priority maybe you'd put CI Galaxy Bitcoin ETF at the top and call it the best. At this point though, there isn't a lot to go on if we're judging the best Bitcoin ETF in Canada.

About the Author

Related Round Up Reviews