Best Performing ETFs of 2024

Exchange-traded funds (ETFs) have become tremendously popular among investors since they allow buying a collection of assets in a single fund. Investors can generally trade ETFs on regular exchanges, making them a practical way of investing with low transaction costs. In the crypto market, a so-called cryptocurrency ETF is a fund that consists of various cryptocurrencies and tracks the price of one or multiple digital coins. This article will review the best performing ETFs focusing on cryptocurrencies..

What Is an Exchange Traded Fund?

In the broad sense, ETFs hold a collection of assets that often track an underlying index. Hence, ETFs are similar to mutual funds, but an advantage of ETFs is that investors can trade their shares continuously throughout the trading day. In contrast, investors can buy or redeem shares in mutual funds only when the trading day closes.

An ETF can be considered a cryptocurrency ETF when it invests in projects utilizing blockchain technology. Alternatively, a cryptocurrency ETF is a blockchain-based ETF investing in cryptocurrency investment products. In a sense, crypto ETFs are the extended use case of blockchain technology.

How Does an ETF Work?

Cryptocurrency ETFs own cryptocurrency futures, options, or other crypto-based securities. They differ from traditional EFTs, which directly own the underlying asset. Crypto ETFs are either backed by crypto assets or derivatives. In the first case, investors directly own crypto assets without bearing the expenses of owning them outright. In the second case, the ETF share price reflects the price movements of derivatives.

But why should an investor consider investing in crypto ETFs? The main reason is portfolio diversification. A crypto EFT is an excellent solution if you want to diversify your portfolio but do not want to manage your cryptocurrency investments actively. But before investing in a crypto ETF, ensure you know all the fees and the expense ratio you must pay.

TOP Performing ETFs

If you plan to capitalize on the potential of blockchain technology, crypto ETFs are an easy way to invest in companies pursuing blockchain-based solutions. We review the best performers of this new ETF category, using total assets under management (AUM) as a point of comparison.

Bitwise Crypto Industry Innovators ETF (BITQ)

Expense ratio: 0.85%
Assets under management: $63 million
Investing strategy: Passive

The BITQ ETF is a passively managed fund that tracks the performance of the Bitwise Crypto Innovators 30 index. It comprises thirty stocks of companies providing mining equipment and financial services to the cryptocurrency markets. The Bitwise Crypto Innovators 30 Index includes only companies generating 75% of revenues from cryptocurrency or having 75% of their net holdings in crypto assets.

Global X Blockchain ETF (BKCH)

Expense ratio: 0.50%
Assets under management: $64 million
Investing strategy: Passive

This passively managed fund invests in crypto mining companies, crypto exchanges, and companies developing new blockchain applications. The BKCH ETF typically hold a concentrated portfolio of 25-40 blockchain companies.

Siren Nasdaq NexGen Economy ETF (BLCN)

Expense ratio: 0.68%
Assets under management: $104 million
Investing strategy: Passive

The BLCN ETF is a passively managed fund launched in 2018. It tracks the Nasdaq Blockchain Economy Index, which includes the stock of companies in the blockchain industry. Currently, this fund owns 63 stocks.

Expense ratio: 0.71%
Assets under management: $494 million
Investing strategy: Active

BLOK was launched in January 2018 as the first ETF dedicated to investing in blockchain technology. This actively managed fund targets crypto exchanges, crypto mining companies, and companies developing new blockchain applications.

First Trust SkyBridge Crypto Industry and Digital Economy ETF (CRPT)

Expense ratio: 0.85%
Assets under management: $22 million
Investing strategy: Active

This actively managed fund was launched in September 2021. The CRPT ETF invests at least 80% of its net assets in companies actively dealing with cryptocurrencies. Currently, this crypto ETF owns 30 stocks.

Conclusion

While ETFs have been available since the mid-1990s, crypto ETFs are much more recent. However, they have been gaining popularity because of the benefits they offer. First and foremost, ETFs allow investors to diversify their portfolios without the burden of managing their assets actively. Moreover, all parties involved in crypto ETF investments are watched and verified by regulatory authorities in the United States. Nevertheless, the volatility of the crypto market can lead to extensive price fluctuations in crypto ETF investments.

So, whether ETF is something for you depends exclusively on your knowledge and experience as an investor. But if you prefer to invest in cryptocurrencies by purchasing directly, you can use LetsExchange.io. Our exchange platform supports over 4,000 digital coins and assets.

FAQ

Which crypto ETF is best?

All the crypto ETFs listed in this article are considered the best ETFs of their type.

Which ETF has the highest return?

Usually, crypto ETFs with larger AUM tend to give better returns.

What is the safest ETF to buy?

The safest crypto ETFs are those trading in publicly-traded blockchain companies.

Disclaimer

Please keep in mind that the above information is based exclusively on our observations and is provided for informational purposes only. It doesn’t constitute any kind of financial advice nor represents an official forecast. Cryptocurrency is a highly volatile asset, and you are investing in it at your own risk.

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