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10 Ways Canadians Can Invest In Cryptocurrencies Like Bitcoin

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You have read how great cryptocurrencies like Bitcoin, Ether, Dogecoin, etc. are, did your research on how to pick cryptos, and have also selected which cryptos you want to invest in. Now, you are ready to invest in it and see your money grow. But how do you invest in cryptos?

You can invest in cryptocurrencies by trading actively via an exchange or through actively managed crypto funds. Think of this as investing directly in stocks and investing in actively managed hedge funds where fund managers will pool money from you and make tactical investment decisions such as which cryptos to invest in, when to buy, when to sell, etc. Alternatively, you can invest passively via ETFs as well. 

In this article, we tell you about 10 ways through which you can invest in cryptos.

Top Cryptocurrency Exchanges 

Coinbase – World’s Largest Cryptocurrency Exchange

Being one of the world’s largest cryptocurrency exchanges, you can be assured as an investor that Coinbase is one of the safest platforms in this space. It charges you either a flat fee of 0.5% or a variable fee. You will have to pay 3.99% if you buy through debit or credit cards.

Another option is Coinbase Pro which works as a regular exchange where you connect with other users to buy and sell cryptos. Maker and taker fees are high at 0.5% for users who trade less than $10,000 a month.

Binance – Another Global Stalwart

It is one of the world’s oldest and largest cryptocurrency exchanges with one of the lowest trading fees of them all: 0.1% for both maker and taker. When you withdraw your cryptocurrency from Binance, you have to pay a flat fee in the form of the cryptocurrency. For Bitcoin, the fee is 0.0005 BTC.

Kraken – Low Fees

Founded in 2013, Kraken quickly became one of the largest Bitcoin exchanges in terms of average trading volume as it accepts deposits from all over the world, including Canada. Kraken also charges a very low fee at just 0.25%.

Besides, it offers excellent security and ample liquidity because of its trade volume. However, if you are a first-time user in this space, there is a chance that you may find Kraken’s user interface slightly difficult to understand.

Coin Mama – Quick Onboarding

If you are looking to start a new account and purchase Bitcoin immediately, then you should consider Coinmama. Over the last few years Coinmama has emerged as a suitable exchange for investors who want to buy Bitcoin as soon as possible. The entire onboarding process i.e. setting up a new account and getting verified can be done within one hour if you opt for the service of Coin Mama. 

However, this fast onboarding customer service costs you a higher fee. It is considered one of the most expensive exchanges if you’re looking to buy Bitcoin in Canada.

Changelly – Best Alt Coins  

This exchange is suitable for crypto investors who are looking for Altcoins in the crypto space. All cryptocurrencies that came after Bitcoin are known as Altcoins. So if you are on the lookout for other smaller cryptocurrencies that can be the next big thing, then Changelly may be for you. Not that other platforms do not offer smaller cryptocurrencies, but Changelly offers a wider range when it comes to smaller Altcoins.

Shakepay – Can Buy Small Amounts 

Shakepay is a platform that is only available to Canadians to buy and sell Bitcoin and Ethereum. It is easy to move crypto from Shakepay to your personal wallet. Its Shakepay Change feature allows users to buy a small amount of Bitcoin every time they swipe their debit or credit cards.

Actively Managed Crypto Funds

Just as you give your money to a hedge fund manager to make tactical investment decisions on your behalf and give them a fee for their expertise, you can do that in crypto as well. Actively managed crypto funds invest in a portfolio of cryptocurrencies and fund managers actively manage them. Given the volatility in the crypto space, actively managed funds argue that cryptocurrencies are so volatile that you need an expert to manage them all the time. 

Two well-known crypto funds are Pantera Bitcoin Fund and Rivemont Crypto Fund.

Pantera Bitcoin Fund

Pantera charges a management fee of 0.75% and a realization fee of 1%. You need a minimum of $100,000 to invest in the fund and it doesn’t charge any performance fees.

Rivemont Crypto Fund

It has fees on the higher side. For a class A investor, the fixed fee is 2% and a performance fee of 20%. The performance fee is applicable only when the fund delivers. Fixed fees for Class B and Class F investors are 1.5% and 1% respectively. The performance fee for both investor classes is 20%. Launched in 2017, Rivemont is Canada’s only authorized actively managed crypto fund.

Passively Managed ETFs

There are various crypto ETFs that are available for people to invest in. Here are some of the crypto ETFs which you can buy. The expense ratios i.e. the money these ETFs will charge you is also mentioned below. .

Purpose Bitcoin ETF

This is a Canadian ETF that only holds Bitcoins. Buying this ETF is equivalent to buying Bitcoins. However, one major point to keep in mind while buying the Purpose Bitcoin ETF is its steep 1% annual management fees. However, this is a great option for people who are not tech-savvy.

Galaxy Bitcoin ETF

The Galaxy Bitcoin ETF began trading in March 2021. It has a management fee of just 0.4% which is among the lowest fees in the crypto ETF world.

Conclusion

While there are various ways to buy cryptocurrencies, you should understand investing in this asset class is a high-risk proposition. While institutional investors have entered the crypto space, retail investors should invest capital that they can afford to lose considering the lack of regulations and significant volatility. Take part in this high-risk and high-reward asset class, but do not bet your house on it.


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