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Should the BTCC ETF be Part of Your Portfolio?

BTCC ETF

What is the BTCC ETF?

In comparison to traditional ETFs, which often spread your money over a number of different assets that are linked by sector or region, the Purpose Bitcoin ETF (TSX:BTCC) solely invests in the flagship cryptocurrency. Because traditional banks and brokerages do not yet recognize cryptocurrency as a currency, this is a solid option for a retail investor to buy Bitcoin on the stock market.

The BTCC ETF is the world’s first fund that is physically backed by Bitcoin rather than derivatives. Retail investors will be able to invest in Bitcoin through BTCC without needing to buy and keep the digital currency themselves.

Some Key Facts:

  • Inception Date: February 18, 2021
  • Fund AUM: $891.9M CAD
  • MER: 1%
  • Number of Bitcoins: 19692.1488 BTC
  • NAV: 7.74$
  • Exchange: Toronto Stock exchange

Pros of BTCC:

  • You can buy and sell BTCC ETF shares without having to deal with the latencies and delays that come with cryptocurrency trading platforms.
  • You will be able to store your bitcoins in your TFSA and RRSP
  • This ETF will also increase the liquidity of your Bitcoin by allowing you to withdraw any amount by simply selling your BTCC shares on the market.
  • In comparison to a bitcoin digital wallet, retrieving a forgotten password for your brokerage account is far easier.

Cons of BTCC ETF:

  • Bitcoin is quite volatile, which means that the price of the BTCC ETF is also likely to be unpredictable
  • Only gives you exposure to Bitcoins (no diversification)

Performance of this Canadian Bitcoin ETF

Since its inception on Feb. 18, the price of the BTCC ETF has lost significant value compared to its original $10-per-unit price, due to the decline in the price of Bitcoin . Despite its relatively high management fee of 1%, the first bitcoin ETF, has proven immensely popular with investors. It has more than $1.22 billion in assets under management in less than six months.

For instance, after decreasing its management fee to 0.75 percent immediately after introduction, the Evolve Fund Group’s Bitcoin ETF (EBIT), which started one day later, has acquired less than a tenth of the assets of the Purpose ETF.

Conclusion: Should you add BTCC in your portfolio?

Cryptocurrency is no longer a speculative investment. The Bitcoin ETF is an excellent method to begin investing in Bitcoin without having to use a cryptocurrency exchange platform. It also provides extra benefits, such as the ability to purchase Bitcoin through registered accounts like TFSA and RRSP.

If you’re hesitant to start investing in Bitcoin or other cryptocurrencies, it is recommended to start with a little amount of money. The Purpose Bitcoin ETF should provide a trading experience for newcomers to the crypto industry. It is however still a high-risk investment that is far more volatile than traditional securities. Like with any investment, do your homework and never put more money than you’re ready to lose!


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