Two ETFs offer exposure to the crypto market, but one provides more direct exposure to a major digital token. The iShares Ethereum Trust ETF (ETHA +0.14%) and Bitwise Crypto Industry Innovators ETF (BITQ +2.53%) target the cryptocurrency ecosystem but take notably different approaches. This comparison highlights how these approaches differ in cost, performance, risk, and portfolio makeup for investors considering crypto-linked ETFs.
BITQ’s expense ratio is higher than ETHA’s, so it may cost more to hold over time, though ETHA’s lower fee comes with single-asset concentration. ETHA, by contrast, is a single-asset trust exclusively tracking the price of Ethereum (ETH), making it highly concentrated with risk and returns tied to Ether and no diversification from other sectors or companies. BITQ provides exposure to the crypto economy without holding digital assets directly, instead investing in 33 companies that participate in the sector. Its portfolio leans heavily toward financial services, with notable positions in IREN Ltd. (IREN), Coinbase (COIN), and Strategy Inc. (MSTR).
Investors must be aware of the risks of crypto-related ETFs, whether directly or indirectly. ETHA’s shorter track record and single-asset focus can make its price more volatile, while BITQ’s holdings expose investors to crypto-market stock risk. Neither fund pays dividends, and BITQ has posted a negative return since 2021. For investors seeking higher long-term potential with greater risk, ETHA may be appealing, while BITQ offers a less volatile exposure to the crypto market.
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