Bitcoin ETFs are financial instruments designed to track the performance of Bitcoin. These exchange-traded funds allow investors to gain exposure to Bitcoin’s market movements without directly owning the cryptocurrency. By mirroring Bitcoin’s price index, Bitcoin ETFs provide a convenient way to invest in Bitcoin using traditional capital allocation methods.
Investors can use Bitcoin ETFs for diversification or to align their portfolios with Bitcoin holdings. However, it’s important to note that Bitcoin ETFs are taxed similarly to other equities, which may impact net returns compared to direct Bitcoin ownership. Available through various brokers, Bitcoin ETFs offer an accessible entry point into this asset class for professionals seeking structured investment options.
Source: https://www.nbcpalmsprings.com/2025/01/21/crypto-fitz-bitcoin-exchange-traded-funds-and-how-they-work