Cryptocurrencies have become a valuable asset, with Bitcoin (CRYPTO: BTC) almost doubling over the past five years. The famed digital asset is in the middle of a sharp correction, which presents a buy-the-dip opportunity for assets with exposure to the crypto industry.
Luckily, you don’t have to guess which crypto stock will be the next winner. Crypto ETFs give investors broad exposure to the opportunity and have diversified portfolios. These are some of the top funds to consider if you want to ride the upcoming crypto wave.
Bitwise Bitcoin ETF
The Bitwise Bitcoin ETF (NYSEARCA:BITB) offers direct exposure to Bitcoin. This ETF does not contain any other assets, making it easier to invest in the largest cryptocurrency. You don’t have to worry about creating a digital wallet or getting started with a crypto brokerage account. BITF handles it for you and only has a 0.20% expense ratio.
Crypto enthusiasts view Bitcoin as digital gold. There are only 21 million Bitcoins in existence, and without a central authority, it’s impossible to increase the supply of Bitcoin. That setup turns Bitcoin into an inflation hedge that has historically outperformed major benchmarks like the S&P 500 and Nasdaq Composite.
Bitcoin has endured sharp dips over its long history, with multiple instances of 50%+ drops. Bitcoin has lost more than 40% of its value from its all-time high, but when the cryptocurrency regains momentum, Bitwise Bitcoin ETF investors will get to enjoy the rally.
CoinShares Bitcoin Mining ETF
The CoinShares Bitcoin Mining ETF (NASDAQ:WGMI) gives investors exposure to Bitcoin mining companies. Although these companies currently make most of their money from Bitcoin, some of these same picks have pivoted to AI infrastructure. Their Bitcoin mining facilities happen to provide optimal setups for AI data centers.
Some crypto miners included in the ETF have already landed lucrative deals with tech giants. The fund has a little more than 20 holdings since there aren’t many crypto miners, but that hasn’t stopped the fund from doubling over the past year. It’s also a very top-heavy fund, with more than 80% of its capital in its top 10 holdings. Almost all of the stocks in the fund are small-cap companies, with only 31% in mid-cap and large-cap growth stocks.
Investors who want exposure to AI and cryptocurrencies may want to give this fund a closer look. Eight of its top 10 holdings are up over the past year, with the top four holdings all up by more than 150% during that time.
Amplify Blockchain Technology ETF
The Amplify Blockchain Technology ETF (NYSEARCA:BLOK) prioritizes stocks that are at the center of crypto and blockchain technology. Blockchain is the decentralized infrastructure that makes Bitcoin possible. It can potentially reduce transaction fees and create a more affordable version of credit cards.
The technology has great potential, and BLOK gives investors broad exposure to the industry. That has resulted in an annualized 45.8% return over the past three years, with top picks like Galaxy Digital (NASDAQ:GLXY | GLXY Price Prediction), Hut 8 (NASDAQ:HUT), and Robinhood (NASDAQ:HOOD) leading the way. The top 10 holdings make up more than one-third of the fund’s total assets, and the ETF has a little more than 50 stocks in total.
Although the Amplify Blockchain Technology ETF has delivered tremendous returns in recent years, it’s important to remember that it is an actively managed fund. A 0.70% expense ratio is a bit high. While the fund can justify a high expense ratio if it can continue to deliver exceptional returns, the expense ratio can turn into a hindrance if the fund endures a prolonged correction.
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