Top Bitcoin ETFs in Canada in 2021: Investing in Bitcoin

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by Enoch Omololu

Updated

Advertiser Disclosure

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 at 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, investors’ appetite for them and the risks they pose appear to be unabated.

In this post, I cover the four best Bitcoin ETFs currently available on the Toronto Stock Exchange (TSX).

Related: How To Trade Bitcoin in Canada

Best Canadian Bitcoin ETFs

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

Three others have launched since then:

  • Evolve Bitcoin ETF (EBIT)
  • CI Galaxy Bitcoin ETF (BTCX)
  • 3iQ CoinShares Bitcoin ETF (BTCQ)

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 September 7, 2021:

  • Inception date: February 18, 2021
  • Assets under management: $1.26 billion (CAD)
  • Number of Bitcoin: 21302.899898
  • 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 in Canada

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 $150.

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 provides 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 September 7, 2021, include:

  • Inception date: February 19, 2021
  • NAV per unit: $24.22
  • Assets under management: $121.794 million (CAD)
  • Management: 0.75%
  • Price Index: CME CF Bitcoin Reference Rate (BRR)
  • BTC per share: 0.00038141
  • 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 in Canada

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 third 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 September 7, 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.

4. 3iQ CoinShares Bitcoin ETF (BTCQ)

3iQ and CoinShares partnered to offer Canada’s fourth Bitcoin ETF, 3iQ CoinShares Bitcoin ETF (BTCQ).

It is traded on the TSX under two ticker symbols:

  1. BTCQ (CAD and non-currency unhedged)
  2. BTCQ.U (USD and non-currency unhedged)

Key details for BTCQ as of September 3, 2021, are:

  • Inception date: March 31, 2021
  • Assets under management: $1.27 billion (CAD)
  • Management fee: 1.00% (MER up to 1.25%)
  • Eligible accounts: RRSP, RRIF, RDSP, DPSP, RESP, TFSA, personal and corporate non-registered investment accounts
  • Listing currency: CAD & USD
  • Cold storage wallet: 100%

BTCQ Fees and Returns

As of this writing, BTCQ has a 1.00% management fee and its MER is expected to not exceed 1.25%.

Like the other crypto ETFs on this list, performance data for BTCQ should be available after 1 year.

How To Buy BTCQ

BTCQ and BTCQ.U are available on Questrade and Wealthsimple Trade.

You can also purchase it on brokerage platforms owned by the big banks like TD Direct Investing and Scotia iTrade.

Pros of Bitcoin ETFs

Bitcoin 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 of Bitcoin ETFs

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

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:

FeaturesCoinSmartWealthsimple CryptoNDAXBitbuy
Coins OfferedBTC, ETH, LTC, XRP, USDT, BCH, XLM, ADA, QCAD, EOS, NEOBTC, ETH, DOGE, AAVE, BAT, COMP, LTC, BAL, LINK, CRV, KNC, MKR, SNX, UNI, YFI, & 13 othersBTC, ETH, XLM, LTC, EOS, LINK, USDT, DOGE, ADA, XRP, UNI, COMP, DOT, & 5 othersBTC, ETH, LTC, BCH, XRP, XLM, EOS, AAVE
Funding optionsInterac e-Transfer, bank wire, bank draft, credit/debit cardElectronic fund transferInterac e-Transfer, bank draft, and bank wireInterac e-Transfer; bank wire
Fees0.20% – 0.40% trading fees; some on deposits/withdrawals1.5% trading fee; no commission on deposits and withdrawals0.20% trading fee; flat-rate fee for withdrawals0.10% – 0.20% trading fees; some fees for deposits and withdrawals
CIPF/CDIC insuranceNoNoNoNo
Security95% cold storage; 2FACoin held with a regulated custodian – Gemini95% cold storage, 2FA95% cold storage; 2FA
Referral programYes – $20 when you deposit $100Yes – $50 when you trade at least $150 worth of cryptoYes – $10 when you deposit $100Yes – $20 when you deposit an initial $250
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.

Its specs as of September 3, 2021, are:

  • Ticker: QBTC.U and QBTC
  • Net asset value: $816 million (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).

Bitcoin ETF FAQs

Is it better to buy Bitcoin or Bitcoin ETF?

It depends on your comfort level with buying bitcoin directly from an exchange and the use of hardware wallets. If you want hassle-free exposure to bitcoin, the ETF requires less work on your part.

What is the best Bitcoin ETF in Canada?

All four bitcoin ETFs listed above are designed to invest 100% in the physical bitcoin asset and there are no obvious differences in their investment strategies at this time. Using the management fees and associated costs, the best bitcoin ETF for me is CI Galaxy Bitcoin ETF with its 0.40% fee.

Other content relating to cryptocurrency trading:

Top Bitcoin ETFs in Canada in 2021: Investing in Bitcoin
Retirement 101 eBook - 3D

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 Globe and Mail, Winnipeg Free Press, Wealthsimple, Financial Post, Toronto Star, Credit Canada, MSN Money, National Post, CIBC, and many other personal finance publications.

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

2 thoughts on “Top Bitcoin ETFs in Canada in 2021: Investing in Bitcoin”

  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?

  2. Welp, I guess Musk isn’t too interested in Bitcoin anymore. His tweets about Tesla’s BTC have been affecting the market substantially. I need to jump on Coinbase and check everything out. I really wish Musk would stop messing with the market.

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