As an investment, its spectacular rally this year has cheered its adherents while raising the curiosity of the non-initiated.
Maybe you know nothing about Bitcoin and want to get involved but prefer the familiarity of more traditional kinds of investments.
While exchange-traded funds that track the price of Bitcoin have been available for a while in countries such as Canada and in Europe, it’s been a different story in the U.S., where they had long been blocked by regulators.
They each charge $9.50 for every $1,000 you invest, and involve the complicated world of futures, which are tools that traders use to bet on price movements.
Some issuers such as Direxion Investments and Valkyrie Investments have sought to launch Bitcoin futures funds with leverage, which allow investors make supersized bets that the price of Bitcoin will rise or fall.
Because most of its revenue comes from fees it charges users to deposit and trade funds, the valuation of the crypto exchange fluctuates in close correlation with Bitcoin’s price.
With companies that do things other than hold Bitcoin, you have to also evaluate their sector and individual product performance.
Bitcoin is a digital currency: Each unit is an encrypted record stored in a public ledger called a blockchain, as you probably know by now.
On Marathon’s website, the Las Vegas company states that owning a stake “helps you gain exposure to Bitcoin in your portfolio without having to deal with the complications of holding the asset directly.” Castle Rock, Colorado-based Riot specializes in acquisitions of crypto-related businesses: In April, the company disclosed it was buying North America’s largest Bitcoin mining facility, Whinstone U.S., in a $651 million cash-and-stock deal.
Before the futures-based ETFs debuted, trusts were the go-to place to gain interest exposure to Bitcoin.
If you own Bitcoin directly, you’re not paying any fees to hold it or trading fees for humans to work,” said Ryan Cole, a private wealth adviser at Citrine Capital, a San Francisco-based wealth management firm.
That would help resolve the discount issue, thanks to a feature in the ETF format that allows shares to be created and redeemed, keeping the price in line with that of the securities the fund tracks.
There’s also the option of buying one of the many alternative coins, or altcoins for short.
Dogecoin and Shiba Inu have made a splash recently, but the fundamental reasons anyone would invest in either of these “memecoins” are murky at best.
Now, several firms – including exchanges such as Coinbase, money transfer apps like CashApp and brokerages such as Robinhood – have made it easy to buy Bitcoin and other cryptocurrencies, though fees and policies vary.
One of the latest is ‘s Venmo, which allows customers buy, sell and hold cryptocurrencies like Bitcoin and Ethereum.