Crypto ETFs exist to meet the demand for exposure to cryptocurrencies – and with over US$2.3 trillion worth of assets in circulation, Bitcoin and similar cryptocurrencies certainly are an asset class piquing the interest of investors.
Coinciding with the cryptocurrency market reaching a temporary peak in late 2021, there has been a rise in exchange traded funds (ETFs) listed in Australia; giving exposure to crypto such as Bitcoin or Ethereum.
Recent market updates also saw the approval of Bitcoin-tracking ETFs by the US Securities and Exchange Commission (SEC), later mirrored in Australia with the ASX’s decision to approve VanEck Bitcoin ETF (VBTC) in June 2024.
With the cryptocurrencies rallying to this global news, questions surrounding Bitcoin and its place in an investors portfolio have resurfaced, both in Australia and around the globe.
There are currently four ETFs in Australia available for investors to gain exposure to crypto after Cosmos Asset Management delisted DIGA, CBTC and CPET and BT3Q, while ET3Q also closed.
| Ticker Code | ETF Name | Exposure | Exchange |
| CRYP | BetaShares Crypto Innovators ETF | Cryptocurrency companies | ASX |
| EBTC | Global X 21Shares Bitcoin ETF | Bitcoin | Cboe Australia |
| EETH | Global X 21Shares Ethereum ETF | Ethereum | Cboe Australia |
| VTBC | VanEck Bitcoin ETF | Bitcoin | ASX |
Stockspot reviews and compares more than 250 ETFs in our annual Stockspot ETF Report.
In this article, I will analyse cryptocurrency ETFs in Australia across a range of different metrics to ensure investors make an informed choice.
We will explore:
Crypto ETFs size
CRYP was launched in late 2021 and has since become the largest crypto ETF by size with A$138 million net assets.
CRYP broke the record for the fastest Australian ETF to reach $100 million from investors, achieving that milestone four days after launching.
In 2022 EBTC launched but was unfortunately timed prior to the crypto market fall of that year.
EBTC currently has significantly fewer AUM at A$94.7 million compared to ETFs such as CRYP.
The disparity in ETF AUM could be in some way attributed to the unfortunate market timing of EBTC’s launch.
Costs and slippage
CRYP is the lowest cost crypto ETF with a management fee of 0.67% p.a. and spreads of 0.49% while other ETFs charge 1.25% p.a.
| TICKER CODE | MANAGEMENT FEE | BUY/SELL SPREADS (SLIPPAGE) |
| CRYP | 0.67% | 0.29% |
| EBTC | 1.25% | 0.19% |
| EETH | 1.25% | 0.39% |
Crypto ETF liquidity
CRYP used to be the most liquid crypto ETF, trading almost $1.4 Million in average daily volume, but has dropped to around $1.15m and been surpassed by EBTC on $1.3m per day.
The third most liquid cryptocurrency ETF remains EETH with liquidity at $276,000 per day.
By comparison, some of the most popular global share ETFs trade up to $10 million daily.
Returns and track record
As all these ETFs are relatively new, they don’t have long-standing track records for analysis.
Since its inception, CRYP has fallen ~51%. The one year performance sat at 2.90% where the six month figure was ~38%, demonstrating their volatility.
ETFs tracking cryptocurrencies have had a rocky start to their ETF life, launching prior to a period of price falls in the underlying crypto assets.
Research shows that new ETFs often launch just as retail interest is peaking and before a period of poor returns.
We spoke to the AFR about this phenomenon just as these crypto ETFs were launching.
While there have been strong gains visible in the 1 year return, many of these ETFs are still down since inception.
This is one reason that Stockspot avoids niche thematic ETFs for clients, especially in their early stages of launch.
While some cryptocurrencies have had meaningful gains historically, they can also go through periods of large and severe price declines (such as 2011, 2015, 2018 and early 2022).
I explore the volatility of Bitcoin’s market movements in more detail in this article: ‘Is now the right time to invest in Bitcoin?”
| Ticker CODE | INDEX | Index Inception | ETF inception | Index 1 Year Return | Index 3 Year Return (p.a.) | Index 5 Year Return (p.a.) |
| CRYP | Bitwise Crypto Innovators Index | December 2019 | November 2021 | 77.98% | 1.62% | N/A |
| EBTC | CryptoCompare’s Crypto Coin Comparison Aggregated Index (Bitcoin) | April 2014 | May 2022 | 115.84% | N/A | N/A |
| EETH | CryptoCompare’s Crypto Coin Comparison Aggregated Index (Ethereum) | April 2014 | May 2022 | 67.02% | N/A | N/A |
| VTBC | VanEck Bitcoin ETF | June 2024 | June 2024 | N/A | N/A | N/A |
N/A indicates not enough track record given the recent inception of the index. Data as of 18 June 2024
The below table also explores the early figures for the US cryptocurrency ETF market, comparing the top 4 ETFs.
| Symbol | ETF Name | Total Assets ($MM) | YTD |
| GBTC | Grayscale Bitcoin Trust | $18.68 | 71.03% |
| IBIT | IShares Bitcoin Trust Registered | $20.40 | 42.62% |
| FBTC | Fidelity Wise Origin Bitcoin Fund | $11.45 | 42.46% |
| BITO | ProShares Bitcoin Strategy ETF | $1.972 | 52.17% |
Conclusion
Whether you want to invest in a pure Bitcoin ETF, Ethereum ETF or a more broad cryptocurrency industry ETF will depend on your personal preferences.
Unlike other markets like gold, the crypto market is not yet mature, and has proven to be incredibly volatile in recent years.
CRYP gives exposure to companies involved in the crypto market providing more diversification by allowing non-pure play companies.
For the underlying cryptocurrencies, investors need to determine if they want to gain access to crypto via a ‘feeder fund’ that invests in an already existing overseas ETF, or own the underlying asset via a custodial cold storage wallet.
For unhedged exposure, EBTC and EETH track the cryptocurrency in AUD, but you may wish to look at the USD alternative depending on your preference for a hedged or unhedged vehicle.
High-octane and therefore highly speculative investments, like cryptocurrencies, can generate massive returns in a portfolio but also involve a greater risk.
Investing too much prior to a downturn can lead to diminished returns and huge, long term impact for investors. A balanced approach is always safest.
The Stockspot 2022 ETF Report showed that investors in niche thematic ETFs lost over $100m in one year.
I would always recommend that if you want to invest in cryptocurrency, it should only account for a small part of your portfolio.
Ensuring your investments are diversified and aligned with your risk appetite – like with the portfolios we offer at Stockspot – will best place you in the long term to weather market volatility.
