How and Where To Buy Spot Bitcoin ETFs
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The approval of spot Bitcoin ETFs in early 2024 reshaped the cryptocurrency industry and is one of the reasons Bitcoin rocketed to a new record high: The availability of Bitcoin ETFs through online brokerage firms — including within IRAs and other retirement accounts — means everyday investors can give their portfolios exposure to Bitcoin without fussing with separate cryptocurrency exchanges or Bitcoin wallets.
Spot Bitcoin ETFs directly track the price of Bitcoin — prior to 2024, there was no such product. Any ETF that touted itself as a Bitcoin ETF didn't directly invest in Bitcoin or track its price; rather, they were based on Bitcoin futures contracts, or other investments that correlate to the price of the cryptocurrency.
Where to buy spot Bitcoin ETFs
Spot Bitcoin ETFs are available at many online brokers that offer ETFs, often with no trade commission. One major brokerage, Fidelity, had its own spot Bitcoin ETF, the Fidelity Wise Origin Bitcoin Fund (FBTC), approved. Many of the brokers that make our list of the best brokers for ETFs have confirmed they now offer some or all of the approved spot Bitcoin ETFs on their platforms, including:
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How to buy spot Bitcoin ETFs
If you don't already have a brokerage account, you'll need to open one to buy ETFs. (We have a full guide for how to open a brokerage account.) You can open a brokerage account online in about 15 minutes, then fund it by transferring money from a bank account.
Once you have your account open, follow these two steps to purchase Bitcoin ETFs:
1. Search for the ETF you want
The brokerage will have a search tool or ETF screener that will allow you to search for the ETF by its name or ticker symbol. If you don't know which Bitcoin ETF you want to invest in and your brokerage offers access to several, you should compare them — one key detail is the fund's expense ratio, which is the annual cost of owning the ETF. Spot Bitcoin ETF expense ratios currently range from 0.19% to 1.50%, which means if you invest $100, you'll pay between 19 cents and $1.50 per year. Of course, with larger investment amounts, that fee could quickly eat into your return, so you'll want to understand how much you're paying.
2. Place your trade
Once you've funded your account and found the Bitcoin ETF you'd like to purchase, placing your trade is typically as simple as clicking a buy button. You'll get a chance to double-check your order, which means ensuring you've purchased the right number of ETF shares (for the right amount of money) and selected the correct ticker symbol. Once your order goes through, you own the ETF.
Bitcoin ETF definition
One way to think about how a Bitcoin ETF works is to think about each term separately.
Similar to how a standard shipping container can hold many different types of goods and be interchangeably loaded onto any semi-truck or container ship, an ETF can ”hold” many types of investments and be bought and sold like a stock on nearly every major retail brokerage.
Some ETFs contain stocks and track a common index, like the S&P 500, by buying the stock of companies in that index. Spot Bitcoin ETFs directly track the price of Bitcoin.
This means that spot Bitcoin ETFs aren't as diversified as many other ETFs — they are holding a single asset. But they do make Bitcoin easier to add to your portfolio, because you can purchase Bitcoin ETFs in many standard brokerage accounts, and in some cases, within your IRA or other retirement account.
» Learn more: How to buy cryptocurrency
Bitcoin ETF pros
Easy to buy. Many people who have access to a retail brokerage account probably already have access to Bitcoin ETFs. In contrast, investing in Bitcoin itself at minimum requires setting up an account with a crypto exchange, and perhaps looking into Bitcoin wallets for storage, too.
Easier taxes. Crypto sales are subject to taxes, but don’t count on your crypto brokerage to work with your tax software. If you buy and sell ETFs through your traditional brokerage, those sales should get rolled into the rest of your trading activity for the year.
» Ready to get started? Here are the best online brokerages
Bitcoin ETF cons
Ongoing fees. Ongoing fees for Bitcoin ETFs — called expense ratios — can be high compared to ETFs that track stock indices. If you own Bitcoin outright, you don’t pay these fees, though you probably will pay a one-time transaction fee when you buy and sell. Some of the new Bitcoin ETF providers are waiving fees for a set period of time.
Loss of control. A central theme of many cryptocurrencies is the ability to own it without the need for institutions or governments to intervene. If you own a Bitcoin ETF, you don’t have any control over the holdings.
Other ways to invest in Bitcoin
Cryptocurrency is still relatively new and should be approached with caution. But if you’re excited about crypto and feel like you have space in your portfolio to add an investment with a little more pizazz, here are some ways you can invest:
1. Buy Bitcoin directly. Investing in Bitcoin directly is becoming more common — you can even use it to shop on Amazon. But it's still wise to practice caution when adding any new investment to your portfolio.
» Ready to invest? Here are our picks for the best Bitcoin and crypto exchanges
2. Crypto-related investments. If you don’t want to navigate a whole new form of currency, you can still invest in the future of money. Coinbase, a major cryptocurrency exchange, went public in April 2021, meaning you can buy its company stock. (Learn how to buy Coinbase stock.) There are also other cryptocurrency stocks, which can give investors exposure to crypto technology without investing directly in the currencies themselves.
The author and editor both owned Bitcoin at the time of publication. Andy Rosen and Kurt Woock contributed to this report.
