Top Bitcoin ETFs in Canada: Investing in Cryptocurrency

If you have been looking for ways to add Bitcoin to your investment portfolio without having to worry about cold wallets and public keys, a Bitcoin Exchange Traded Fund (ETF) may work for you.

Canadians invented the first ever ETF and Canada has been on the forefront of approving the first Bitcoin ETFs in North American as well.

Cryptocurrencies have taken centre-stage in 2021, with digital currencies like Bitcoin breaking price records that were inconceivable only a few years ago.

While this asset class is relatively new and highly volatile, investor’s appetite for them and the risks they pose appear to be unabated.

In this post, I cover the three Bitcoin ETFs that are currently publicly traded on the Toronto Stock Exchange (TSX).

Related: How To Trade Bitcoin in Canada

Canadian Bitcoin ETFs

The first North American Bitcoin ETF, the Purpose Bitcoin ETF, launched on February 18, 2021.

Two others have launched since then:

  • Evolve Bitcoin ETF (EBIT)
  • CI Galaxy Bitcoin ETF (BTCX)

1. Purpose Bitcoin ETF (BTCC)

BTCC is Purpose Investment’s crypto ETF offering investors exposure to the world’s most popular cryptocurrency.

It is traded on the TSX under three ticker symbols as follows:

  1. BTCC (CAD and currency-hedged)
  2. BTCC.B (CAD and non-currency hedged)
  3. BTCC.U (USD and non-currency hedged)

Below are some key details about the Purpose Bitcoin ETF as of March 15, 2021:

  • Inception date: February 18, 2021
  • Assets under management: $959 million (CAD)
  • Number of Bitcoin: 13564.9398
  • Management fee: 1.00%
  • Eligible accounts: TFSA, RRSP, personal and corporate non-registered investment accounts
  • Listing currency: CAD & USD
  • Cold storage wallet: 100%
  • Hot storage wallet: 0%
  • Eligible for DRIP and PACC

BTCC Fees and Returns

This ETF is very new and its returns performance won’t be available until 1 year after its inception.

It has a 1.00% management fee that is significantly higher than the two other Bitcoin ETFs on this list.

How To Buy Purpose Bitcoin ETF

Investors can purchase Purpose Bitcoin ETF on popular brokerage platforms like Wealthsimple Trade and Questrade.

Wealthsimple Trade offers no-commission trading and a $50 bonus when you fund your account and trade at least $100.

Questrade offers free ETF purchases and competitive trading fees ranging from $4.95 – $9.95 per trade when you sell. You can also get $50 in free trades when you deposit at least $1,000 (offer code SAVVY50).

2. Evolve Bitcoin ETF (EBIT)

Evolve Bitcoin ETF provided investors a practical way to invest directly in Bitcoin using a brokerage account.

It is traded on the TSX under two ticker symbols:

  1. EBIT (CAD, unhedged)
  2. EBIT.U (USD)

Key facts about EBIT as of March 15, 2021, include:

  • Inception date: February 19, 2021
  • NAV per unit: $26.01
  • Assets under management: $78 million (CAD)
  • Management: 0.75%
  • Price Index: CME CF Bitcoin Reference Rate (BRR)
  • BTC per share: 0.00038527
  • Eligible accounts: TFSA, RRPS, personal and business taxable accounts
  • Listing currency: CAD & USD
  • Cold storage wallet: 100%

EBIT Fees and Returns

Similar to BTCC, the performance of this Bitcoin ETF won’t be published until a year from its inception date. Also, its distribution frequency will occur annually if applicable.

EBIT has a management fee of 0.75%.

How To Buy Evolve Bitcoin ETF

You can purchase EBIT using a self-directed brokerage account. Brokerage platforms offering it in Canada include:

Wealthsimple Trade: Offers free ETF and stock purchases. Plus a $50 bonus here.

Questrade: Offers free EBIT purchases. New clients get $50 in free traders using the SAVVY50 offer code.

Related: Bitcoin Trading Apps in Canada.

3. CI Galaxy Bitcoin ETF (BTCX)

The latest Bitcoin ETF in Canada is CI Galaxy Bitcoin ETF.

This ETF is managed by CI Investments in partnership with Galaxy Digital Capital Management.

BTCX is traded on the Toronto Stock Exchange under the ticker symbols:

  1. BTCX.B (CAD and unhedged)
  2. BTCX.U (USD)

The key fund details for this ETF as of March 15, 2021, are:

  • Inception date: March 5, 2021
  • Assets under management: $24.18 million
  • Management fee: 0.40%
  • BTC per unit: 0.000192
  • Eligible accounts: RRSP, RRIF, TFSA, RESP, RDSP, DPSP, personal and corporate mon-registered accounts
  • Cold wallet storage: 100%
  • Listing currency: CAD & USD

BTCX Fees and Returns

BTCX has the lowest management fee of all the three Bitcoin ETFs in Canada, at 0.40%.

Similar to BTCC and EBIT, its performance won’t be available until it has completed one full year.

How To Buy BTCX

BTCX is traded on the TSX and available through all the major brokerage platforms.

You should always keep in mind that this class of assets is very risky and you can lose some or all of your investment.

Pros and Cons of Bitcoin ETFs

Pros

Bticoin ETFs are easier to purchase and hold than buying Bitcoin directly online. With an ETF, you don’t need to worry about securing your keys or digital wallets.

All three funds secure their bitcoin holdings offline in cold storage, so it is ‘protected’ from online hacking/theft.

Unlike the digital currency itself, you can hold a Bitcoin ETF in a registered account (e.g. RRSP & TFSA).

Lastly, when you buy this ETF, you are investing directly in bitcoin and your investment returns will track the price action of the asset itself.

Cons

Bitcoin investing is not appropriate for investors who are not willing to take the risk that they could lose all their investment.

The security is very volatile and experiences intra-day price swings that are not for the faint of heart.

Bitcoin ETFs charge management fees in addition to the brokerage fees you incur if you are not using a no-commission broker.

You can potentially avoid paying a management fee if you purchase Bitcoin directly on a crypto exchange like CoinSmart, NDAX or Wealthsimple Crypto.

If your main interest in Bitcoin is its decentralized system of transactions, that benefit is lost following its packaging as an ETF.

You can’t use your Bitcoin holding within an ETF to complete peer-to-peer transactions. And after you sell your ETF holdings, you are left with fiat.

How To Buy and Hold Bitcoin Directly in Canada

Now that you have read the pros and cons of buying a Bitcoin ETF and purchasing bitcoin directly, the table below shows some of the popular cryptocurrency exchanges you can use to purchase BTC if that’s your preference:

FeaturesCoinSmartNDAXBitbuyWealthsimple Crypto
Coins OfferedBTC, ETH, LTC, XRP, USDT, BCH, XLM, ADA, QCAD, EOS, NEOBTC, ETH, XLM, LTC, EOS, LINK, USDT, DOGE, ADA, XRPBTC, ETH, LTC, BCH, XRP, XLM, EOSBTC and ETH
Funding optionsInterac e-Transfer, bank wire, bank draft, credit/debit cardInterac e-Transfer, bank draft and bank wireInterac e-Transfer; bank wireElectronic fund transfer
Fees0.20% – 0.40% trading fees; some on deposits/withdrawals0.20% trading fee; flat-rate fee for withdrawals0.10% – 0.20% trading fees; some fees for deposits and withdrawals1.5% trading fee; no commission on deposits and withdrawals
CIPF/CDIC insuranceNoNoNoNo
Security95% cold storage; 2FA95% cold storage, 2FA95% cold storage; 2FACoin held with a regulated custodian – Gemini
Referral programYesYesYesYes
Learn moreVisitVisitVisitVisit

Conclusion

Investors can also gain exposure to Bitcoin using 3iQ’s QBTC fund. Also referred to as The Bitcoin Fund, QBTC is a closed-end fund that was launched on April 9, 2020.

It’s specs as of March 16, 2021, are:

  • Ticker: QBTC.U and QBTC
  • Net asset value: $1.636 billion (QBTC)
  • Management fee: 1.95%
  • Eligible accounts: RRSP, TFSA, RRIF, RDSP, DPSP, RESP, personal and corporate taxable accounts.

QBTC is also available for purchase on Questrade and Wealthsimple Trade (only QBTC.U).

Recent news indicates that 3iQ has plans to launch a 3iQ Bitcoin ETF.

Other content relating to cryptocurrency trading:

Top Bitcoin ETFs in Canada: Investing in Cryptocurrency
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Author

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Enoch Omololu

Enoch Omololu is a personal finance expert and a veterinarian. He has a master’s degree in Finance and Investment Management from the University of Aberdeen Business School (Scotland) and has completed several courses and certificates in finance, including the Canadian Securities Course. He also has an MSc. in Agricultural Economics from the University of Manitoba and a Doctor of Veterinary Medicine degree from the University of Ibadan. Enoch has a passion for helping others win with their personal finances and has been writing about money matters for over a decade. His writing has been featured or quoted in the Toronto Star, The Globe and Mail, MSN Money, Financial Post, Winnipeg Free Press, CPA Canada, Credit Canada, Wealthsimple, and many other personal finance publications.

His top investment tools include Wealthsimple and Questrade. He earns cash back on purchases using KOHO and monitors his credit score for free using Borrowell.

1 thought on “Top Bitcoin ETFs in Canada: Investing in Cryptocurrency”

  1. Did you guys see the that Dogecoin is at an all time high? Mark Cuban was talking about it CNBC. Do you guys think it will ever be worth as much as Bitcoin? Did you guys buy any Dogecoin?

    Reply
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