Key takeaways

Spot Bitcoin ETFs are exchange-traded funds that use investors' money to invest directly in Bitcoin.

They were first approved by the Securities and Exchange Commission (SEC) in January 2024.

Cryptocurrencies remain risky and volatile investments, so investors should have a robust understanding before diving in.

Traders looking for a simple way to invest in Bitcoin got their wish in January 2024, when the Securities and Exchange Commission approved several exchange-traded funds that invest directly in the cryptocurrency. The SEC also approved spot Ethereum ETFs in 2024.

As of April 2025, there are 11 spot Bitcoin ETFs available for trading. Here's what you should know about Bitcoin ETFs.

What is a Bitcoin ETF and how does it work?

A spot Bitcoin ETF pools investor money to purchase Bitcoin directly. A Bitcoin ETF is managed by an investment firm and listed on a traditional stock exchange.

Trading cryptocurrencies directly through a crypto exchange can be complicated for some investors. But with the introduction of ETFs tied to Bitcoin, the process of investing is much simpler.

"Investors will now be able to benefit from the added protections of the ETF structure and get Bitcoin exposure as part of a diversified portfolio with less volatility," said Alex Michalka, vice president of investment research at Wealthfront, at the time of the spot Bitcoin ETF approvals.

All ETFs that trade on U.S. exchanges are regulated by the SEC.

Spot Bitcoin ETFs vs. Bitcoin futures ETFs

In contrast to spot Bitcoin ETFs, which invest directly in Bitcoin, Bitcoin futures ETFs provide investors exposure to the price movement of Bitcoin futures contracts. These funds were especially popular prior to 2024, as investors sought an easy, low-cost way to gain cryptocurrency exposure before the SEC had approved spot Bitcoin ETFs.

Like spot Bitcoin ETFs, Bitcoin futures ETFs are managed by investment firms and can be traded on traditional stock exchanges.

Who should invest in Bitcoin ETFs?

Investing in a Bitcoin ETF could be a good option for people who are looking for a more traditional way of investing in the digital currency. Investing directly in Bitcoin can be complicated and involves questions of how the asset will be stored and which exchange to purchase on. ETFs remove some of that complexity by packaging Bitcoin into ETF form.

The ETF structure could also make it easier for some institutional investors to enter the crypto market, which could help keep demand for Bitcoin high.

Still, Bitcoin is a high-risk investment with a very short trading history and no underlying cash flows to support its value. Interested investors should do their due diligence -- as with any investment -- before deciding to invest.

Where do you purchase Bitcoin ETFs?

Bitcoin ETFs are available through most online brokers that offer traditional securities like stocks and bonds. Some of these brokers may also offer the opportunity to invest in Bitcoin directly, while others only allow you to trade Bitcoin futures.

ETFs trade on traditional exchanges such as the New York Stock Exchange or the Nasdaq. If you're interested in the widest offering of cryptocurrencies and are looking to directly invest in digital coins, you'll need an account with a crypto exchange, such as Binance or Kraken.

List of Bitcoin ETFs

Other types of crypto-related investments

If you're not satisfied with the offering of crypto-related ETFs, you have some other options for investing in the digital currency world.

Invest in crypto directly

You can always choose to invest directly in cryptocurrencies through a broker or crypto exchange. Some brokers offer a limited number of options for investing in crypto, typically offering only the major coins. If you're looking for a broad offering, you'll need to go through a crypto exchange, but be careful to watch out for costly fees associated with buying and selling.

Blockchain ETFs

Another way to make crypto-adjacent investments is to invest in ETFs focused on blockchain, which is the technology behind cryptocurrencies like Bitcoin and Ethereum. Blockchain ETFs hold stocks of companies that are using blockchain technology as part of their current and future business plans. Holdings often include a combination of crypto companies, tech giants and financial institutions.

Stock in crypto companies

There is also the option of investing in stocks of companies that are directly involved in cryptocurrency. Coinbase, a large crypto exchange, went public in 2021 and other companies such as PayPal ( PYPL ) and Robinhood have also made a push into cryptocurrencies. Be sure to thoroughly research each company and understand how much of their business is tied to crypto before investing.

Crypto ( CRCW ) index funds

You may also choose to invest in a crypto index fund, which is a fund that tracks the performance of a crypto index. For example, the Bitwise 10 Crypto Index Fund ( BITW ) tracks the performance of the Bitwise 10 Large Cap Crypto Index. Investors may appreciate the ability to invest in a basket of cryptocurrencies without having to do extensive research on each individual crypto. However, it is still essential to understand the fees and risks associated with any crypto investment.

Bottom line

Bitcoin ETFs have made investing in crypto cheaper and easier for everyday investors seeking to diversify. There are also other ways to get in on the crypto action through stocks and ETFs that are indirectly tied to crypto or blockchain technology. You can also invest directly through a crypto exchange.

Editorial Disclaimer: All investors are advised to conduct their own independent research into investment strategies before making an investment decision. In addition, investors are advised that past investment product performance is no guarantee of future price appreciation.