Cryptocurrencies have gained unprecedented popularity this year, with the likes of Bitcoin and Ethereum reaching all-time highs recently, and new cryptos like Cardano and Dogecoin soaring into the spotlight in 2021.
Cryptocurrency has taken the world by storm and even billionaire celebrities have jumped on the bandwagon. But it’s not just the cryptos themselves getting all the attention, as crypto ETFs are also on the rise.
Crypto ETFs, or Exchange Traded Funds, track one or more digital tokens and currencies and give investors more of a macro view of the crypto market. Think of a crypto ETF as a “basket” of various cryptocurrency assets and companies within the cryptocurrency sector, the price movement of which can be invested in.
This gives CFD traders the ability to diversify their portfolio by exposing it to the cryptocurrency markets without having to choose one single cryptocurrency, and without the hassle of an e-wallet. With over 1000 cryptos in the market, crypto ETFs have become a popular choice amongst those who wish to get into the market but aren’t sure which currency to trade, or want to gradually ease their portfolios into the sector.
Let’s run through some of the most popular crypto ETFs and how you can trade Bitcoin and other crypto ETFs in the form of CFDs.
Top crypto ETFs
There are a host of crypto ETFs making waves in the markets at the moment but here are a few of the most popular:
Amplify Transformational Data Sharing ETF (BLOK)
Amplify Transformational Data Sharing ETF (BLOK) has been around since 2018, and instead of tracking an index, this ETF focuses on 55 stocks that are in the blockchain technology field for the most part, such as MicroStrategy Inc. The ETF has over $1 billion in assets under management.
Reality Shares Nasdaq NexGen Economy ETF (BLCN)
Another popular crypto ETF is Reality Shares Nasdaq NexGen Economy ETF (BLCN), which tracks the Reality Shares Nasdaq Blockchain Economy Index comprising 74 companies, including IBM. This ETF boasts $278 million worth of assets under its management.
First Trust Indxx Innovative Transaction & Process ETF (LEGR)
This is another popular choice, tracking over 100 companies (such as Baidu and Micron Technologies) in the Indxx Blockchain Index. This ETF has around $54.4 million of assets under management.
Purpose Bitcoin ETF (BTTC)
Purpose Bitcoin ETF (BTTC) is another well-known choice, and the globe’s first Bitcoin ETF. It burst onto the scene last year and hasn’t looked back since, clocking up $590 million in assets under management. This ETF purchases Bitcoin, but retains it in cold storage, allowing traders to trade Bitcoin price movements without having to purchase any coins directly.
Innovation Shares NextGen Protocol ETF (KOIN)
Last but not least, we have Innovation Shares NextGen Protocol ETF (KOIN), which tracks the Innovation Labs Blockchain Index, including such companies as Microsoft and Visa, and with roughly $20.6 million worth of assets under management.
How to trade crypto ETFs
When it comes to cryptocurrency, volatility is the name of the game, as even the most popular cryptos like Bitcoin are prone to huge bouts of volatility. Such volatility could provide those looking to trade Bitcoin and crypto ETFs as CFDs, or Contracts For Difference, with both opportunities and risks.
CFDs allow you to invest in the price movement in both directions—increases as well as decreases—of a variety of cryptocurrencies, without the need to purchase the underlying asset (in this case any actual crypto), and with no e-wallet required.
iFOREX is a leading global broker that offers hundreds of CFD instruments including shares, commodities, ETFs, indices, foreign currency pairs, and cryptocurrencies. But before you start to trade Bitcoin or crypto ETFs as CFDs, be sure to take advantage of the brand’s signature educational program, built right into the innovative trading platform. After you’ve opened an account, choose from trading guides, interactive video tutorials, and 1-on-1 training with a live trading coach who can help you develop your skills at your own pace.
The iFOREX trading platform provides traders with an intuitive, easy-to-navigate interface that makes it easy to find your way around and open, close, and monitor deals. Built right into the platform is a wide variety of helpful tools and features including market alerts, trading signals, detailed analysis charts, and risk management tools like Stop Loss and Take Profit orders.
Before you trade Bitcoin prices as CFDs, you can also take the iFOREX trading platform for a test drive with a risk-free demo account, available after your first deposit. Open and close deals without risking actual funds and get a feel for the platform until you’re ready to start trading with real money. At iFOREX, every client has the opportunity to begin their trading journey with knowledge.
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