Best Bitcoin ETFs in Canada (2021)

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In the space of just 3 months, Canadians went from no bitcoin ETFs to having over 10 bitcoin ETF variants by May 2021.

With a market capitalization above USD$1 trillion, Bitcoin is the most popular and largest cryptocurrency. But before now, investors have to either buy it directly and store it themselves or use an investment fund like the ones introduced last year by 3iQ.

That has changed with the introduction of bitcoin ETFs. Getting started with bitcoin investing is now accessible to every investor.

This post provides an overview of the best Bitcoin ETFs in Canada, their key features, how to invest in them and the benefits and drawbacks.

Note for US Investors: You can invest in these ETFs if your brokerage provides access to stocks and ETFs listed on Toronto Stock Exchange (TSX). Interactive Brokers is an example.

Top Canadian Bitcoin ETFs

Here are the best Bitcoin ETFs available in Canada:

1. Purpose Bitcoin ETF (BTCC)

  • Ticker: BTCC
  • Fees: 1.00%
  • Asset Under Management (AUM): 1.3Billion
  • Currencies: CAD & USD
  • Inception Date: February 18, 2021
  • TFSA/RRSP Eligible: Yes
  • Bitcoin Holding (Apr 2021): 19,022.31

The Purpose Bitcoin ETF holds the record as the very first bitcoin ETF not only in Canada, but also worldwide.

Since its introduction on Feb 18, 2021, it has managed to grow its asset under management (AUM) to $1.3 billion, crossing the $1 billion mark in less than a month. Its Bitcoin Holding also grew from just 85 at inception to over 19,000 as at April 30, 2021.

It is traded on the Toronto Stock Exchange (TSX) and available in 3 different variants with different ticker symbols:

  • CAD Non-Currency Hedged: BTCC
  • CAD Currency Hedged: BTCC.B
  • USD Non-Currency Hedged: BTCC.U

While the management fee is 1.00%, the MER or total cost of the Purpose Bitcoin ETF is not known yet. But the MER will be capped at 1.50% with any savings passed along to the ETF holders.

It is too early to assess the ETF performance and returns. But you can expect it to track the performance of Bitcoin, net of the management expense ratio (MER) – at least for the USD ETF. The returns for the two CAD ETFs will be subject to some currency risk, though the risk is hedged for BTCC.B.

How to Invest in Purpose Bitcoin ETF (BTCC)

Interested investors can buy the ETF through their existing brokerages. The trading commissions will be the same as what you pay on other ETFs.

Better still, you can use a brokerage or trading app that lets you buy ETFs for free.

Wealthsimple Trade is a great choice for this. It is Canada’s first commission-free trading app that provides investors with zero fees on ETF and stock buy or sell. You can get a $10 welcome bonus using this referral link.

Questrade also allows free ETF purchases on its platform, though it charges for selling ETFs and trading stocks. New users can get $50 in trade rebate using this promo code.


2. 3iQ CoinShares Bitcoin ETF (BTCQ)

  • Ticker: BTCQ
  • Fees: 1.00%
  • Asset Under Management (AUM): 1.24Billion
  • Currencies: CAD & USD
  • Inception Date: March 31, 2021

3iQ CoinShares Bitcoin ETF (BTCQ) is a crypto ETF from 3iQ, the largest digital asset investment fund manager in Canada, and CoinShares, Europe’s largest digital asset fund manager.

BTCQ is listed on the Toronto Stock Exchange and it’s an open-ended bitcoin ETF – meaning it can issue an unlimited number of shares to investors. Investors can choose between the USD or CAD versions with ticker symbols BTCQ.U and BTCQ respectively.

Like the Purpose Bitcoin ETF, the 3iQ CoinShares Bitcoin ETF has enjoyed wide growth since it started trading on the TSX on April 19, 2021. In fact, it is the fastest bitcoin ETF to cross C$1 billion in AUM, achieving the feat in just 3 weeks.

Before the launch of its Bitcoin ETF, 3iQ already had a first-of-its-kind publicly-listed bitcoin investment fund that was introduced in April 2020. It trades on the TSX under the ticker symbols QBTC (CAD) and QBTC.U and has a current net asset value of over C$1.6 billion.

The difference between BTCQ and the older bitcoin fund is that QBTC is a closed-end fund.

BTCQ has a management fee of 1.0% and the MER is capped at 1.25%. MER is the total fee for a fund and includes the management fee, operating cost and all other expenses incurred by the fund.


3. Ninepoint Bitcoin ETF (BITC)

  • Ticker: BITC
  • Mgt Fees: 0.70%
  • Asset Under Management (AUM): USD258.6 Million
  • Currencies: CAD & USD
  • Listing Date: May 6, 2021
  • TFSA/RRSP Eligible: Yes

The Ninepoint Bitcoin ETF (BITC) was also a closed-end fund that was converted into an ETF. The former fund started trading on January 27, 2021.

Ninepoint is marketing BITC as an environmentally-friendly and carbon-neutral way to invest in bitcoin. It does this by paying for the carbon offset out of the management fee it charges.

BITC is listed on TSX and can be traded either in CAD or USD with tickers BITC and BITC.U respectively.

Like all the other bitcoin ETFs on this list, the risk rating is High.


4. Evolve Bitcoin ETF (EBIT)

  • Ticker: EBIT
  • Mgt Fees: 0.75%
  • Asset Under Management (AUM): C$101.9 Million
  • Currencies: CAD & USD
  • Listing Date: February 19, 2021
  • TFSA/RRSP Eligible: Yes

­Evolve Bitcoin ETF was launched just a day after Purpose Bitcoin ETF, but it has not enjoyed the same level of success or growth.

The ETF invests only in bitcoin and has a lower management fee of 0.75%. Returns and performance data are not available yet because the ETF is new.

EBIT is traded on the Toronto Stock Exchange (TSX) and available in both CAD and USD with different ticker symbols:

  • CAD Unhedged: EBIT
  • US Dollars: EBIT.U

Options Trading is also available for the ETF through Montreal Exchange.

How to Invest in Evolve Bitcoin ETF (EBIT)

The Evolve Bitcoin ETF provides a convenient way to hold bitcoin in your investment account through any of the brokerages in Canada.

To keep your investment costs low, you should consider buying the ETF at a brokerage that allows commission-free buying of ETF. You can do this on Wealthsimple Trade and Questrade.

If you’re a new user, you can get a welcome bonus of $10 from Wealthsimple Trade and $50 from Questrade.


4. CI Galaxy Bitcoin ETF (BTCX)

  • Ticker: BTCX
  • Fees: 0.40%
  • Asset Under Management (AUM): C$129.6 Million
  • Currencies: CAD & USD
  • Listing Date: March 5, 2021
  • TFSA/RRSP Eligible: Yes

CI Galaxy Bitcoin ETF (BTCX) was launched in March 2021 by CI Investments in partnership with Galaxy Digital Capital Management LP, the Portfolio Manager of the ETF.

Like the other bitcoin ETFs, BTCX is listed on the Toronto Stock Exchange and offers both a CAD and USD variant of the ETF:

  • CAD Unhedged: BTCX.B
  • US Dollars: BTCX.U

Fees: At just 0.40%, BTCX has the lowest management fee among the bitcoin ETFs in Canada. It has also capped its MER at 0.95%, much lower than Purpose Investment’s 1.50% or 3iQ’s 1.25%.


Why hold Canadian Bitcoin ETFs (Pros)

Here are some benefits of holding a bitcoin ETF instead of buying bitcoin directly through a cryptocurrency trading app.

  • Exposure to Bitcoin in registered accounts: Want to hold bitcoin in your TFSA, RRSP or other registered accounts, the bitcoin ETFs make it possible. By holding them in a more tax-efficient account, you’ll be able to keep more of your gains.
  • Convenience: The bitcoin ETFs make investing in cryptocurrencies easy and accessible to all investors. You don’t have to worry about downloading an app, keeping your wallet’s private keys safe or any of the other concerns with buying a digital currency directly.
  • Safety: The bitcoin ETFs are stored in cold storage to eliminate the risk of hacks and theft of the bitcoin holding.

But there are a few cons and drawbacks to holding bitcoin ETFs

  • Higher Fees: The 2 largest ETFs have a management fee of 1% and you can expect a higher fee after adding the operating expenses. You can avoid some of these fees if you invest in directly in bitcoin through a crypto app with lower fees and spread.
  • Less Control: You’ll have less control over your bitcoin holding since you can’t hold them in your own private wallet.

How to buy the Bitcoin ETFs in Canada

One of the biggest benefits of investing in bitcoin through an ETF is the opportunity to buy them from your favourite brokerage.

There’s the added trading cost, but you should pay the exact fee as you would for trading any other ETF. But you can avoid the extra commissions completely if you invest using a commission-free investing platform.

If you’re looking for no commission brokerages or investing apps, the 2 below are great options for Canadians:

Wealthsimple Trade

This self-directed trading app from Wealthsimple, Canada’s most popular robo-advisor, is the first commission-free investing app in Canada.

Not only does it let you buy and sell ETFs for free, you can also trade thousands of stocks listed on US and Canada exchanges for free. The only fee is a currency conversion cost of 1.5-2% when you trade USD stocks.

That means you can buy any of the CAD bitcoin ETFs above for free, but there’s the currency conversion cost if you choose the USD options.

Get $10 welcome bonus using this Wealthsimple Trade promo link or by clicking the button below.

Related Post: Wealthsimple Trade Promotion & Referral Code

Questrade

Like Wealthsimple Trade, buying ETFs on Questrade is free. However, there’s a fee to sell ETFs or trade stocks. The commission starts at $4.95 but capped at $9.95.

If you’re buying the CAD bitcoin ETFs, either brokerage would do just fine. Buying the USD bitcoin ETFs are however tricky.

At lower amounts, say less than $250, Wealthsimple trade will be cheaper. But paying the flat fee at Questrade will be cheaper for larger investment amounts.

Get $50 welcome bonus using this Questrade Offer code or by clicking the button below.

Related Post: Questrade Offer Code: Get Up To $299 (Bonus + Rebate)


Are the Bitcoin ETFs safe?

All the bitcoin ETF providers are regulated by the appropriate Canadian authorities. So you can be rest assured that your investments are professional managed.

All the bitcoin ETF providers use third party custodians to hold the underlying bitcoins in cold storage. Many of them use Gemini, a US regulated crypto custodian, as either the custodian or sub-custodian.

This provides extra safety and reduces the chance of your bitcoin getting stolen due to hacks or human errors.

Also, you should understand that bitcoin is speculative, very volatile and wide swings are common. The risks are way higher than the risks of normal stock investing. So you should understand your risk appetite and only invest a small percentage of your portfolio in it.

How to buy bitcoin in Canada using the best crypto apps and exchanges

How to Buy Bitcoin in Canada (Crypto Apps & Exchanges)

So what are the alternatives to Bitcoin ETFs in Canada? If you want to place your own trades, hold your bitcoin in your own wallets and manage the investments yourself, here are 3 of the best crypto apps and exchanges available to Canadians:

a. Newton

Though relatively new, Newton has one of the best and cheapest crypto investing platforms in Canada. They currently support 10 different cryptocurrencies such as Bitcoin, Ethereum, Ripple, Tether and so on.

Its spread generally ranges between 0.50-0.70%, compared to 1-2% at many other Canadian crypto exchanges.

Funding or withdrawing CAD from your account is also free. And you can bring your own digital currencies or transfer them out. If you want to withdraw your bitcoin, they’ll cover the mining cost up to $5.

You can read my post on Newton Review and Referral Code here.

For lower trading fees, also check out NDAX. Read my full NDAX review here.

b. Shakepay

Shakepay is another crypto investing app available to Canadians.

There are no fees to deposit, withdraw or trade bitcoin or Ethereum. Like Newton, they make their money through the spread between the reference bitcoin price and the quoted price.

In addition to crypto investing, you can also use the app for peer-to-peer payments to other Shakepay users. And if you want to earn bitcoin as cash back on your purchases, you can get on the waitlist for the Shakepay Card.

Check here for a Shakepay Review and Referral Code or use the button below to get a $30 welcome bonus when you sign up.

c. Wealthsimple Crypto

Wealthsimple started offering bitcoin and Ethereum trading to its users in 2020. There are no direct fees or commission to buy or sell, but it charges an operation fee of 1.5-2% as a spread on the price that is quoted on the app.

Unlike Newton and Shakepay, you can’t withdraw your bitcoin or ethereum from the Wealthsimple Crypto account. You’ll have to sell them and withdraw the CAD.

While the available digital coins and features are still limited for now, more features should be added in the future.

Get $10 bonus when you trade your first $100 using this link. You can also check here for my full Wealthsimple Crypto Review.


What about Ethereum ETFs?

Bitcoin is just one of the several cryptocurrencies, so are there other Crypto ETFs in Canada?

Fortunately, Yes. But your options are currently limited to only the 2 largest digital currencies, Bitcoin and Ether, at the moment.

With the exception of Ninepoint, all the Bitcoin ETF providers above also have Ether ETFs or Ethereum ETFs. You can check this post for the best Ethereum ETFs in Canada.

Conclusion

The Canadian Bitcoin ETFs offer a convenient way to start investing in the most popular and most capitalized cryptocurrency.

When you’re ready, any of the ETFs above are a great place to start. And Canadians can also expect more options soon. Horizon ETFs already has Bitcoin futures, so it won’t be surprising if they introduce a traditional ETF in the near future.

Related Post: Best Crypto ETFs in Canada

Simon is a CPA by day and a Personal Finance Blogger by night. With over a decade experience in financial services, he's passionate about personal finance, investing and helping people take control of their financial life.

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