Crypto ETFs still a popular item on investors’ menu

Cryptocurrency ETFs and ETFs with exposure to crypto (e.g. crypto mining companies, companies that hold cryptocurrencies) are the 10th most popular ETF theme this year, attracting over $550 million. While many sceptics thought 2022 would be the end of the crypto fad, the theme is still going strong amid geopolitical unrest and with more institutions embracing digital assets.

The total cryptocurrency market cap currently stands at $2.14 trillion (as of March 30th, 2022), up by 50% since it reached $1.5 trillion in late January.  The crypto market fear and greed index, which depicts the market sentiment for the cryptocurrencies has shifted from "extreme fear" to "greed" over the past month, signalling optimism in the crypto space.

Bitcoin remains the largest cryptocurrency by market cap ($898 billion), followed by Ethereum ($407 billion), stablecoin Tether ($81.71 billion), Binance Coin ($72.1 billion), and stablecoin USD coin ($51.92 billion).

Institutions increasingly adopt cryptocurrencies

Institutions have been key in the crypto rally, with increased interest and adoption. Cointelegraph reported BlackRock CEO Larry Fink said the Russia-Ukraine war could prompt nations to reevaluate their currency dependencies, potentially accelerating the adoption of digital assets. Specifically, the BlackRock CEO touted cryptocurrencies as a viable tool for international settlements and transactions. Last year, institutional investors traded $1.14 trillion worth of crypto via Coinbase alone — nearly ten times as much as in 2020, and more than twice the $535 billion for retail (coinbase.com).

In regulatory news, President Biden released on March 9th, 2022, the Executive Order on Ensuring Responsible Development of Digital Assets, which outlines the Biden-Harris administration’s first official response to the digital assets industry. The executive order highlights the deficiencies in digital assets regulations. The order directs federal government departments and agencies, working in collaboration, to produce various reports, frameworks, analyses, and regulatory and legislative recommendations to the administration.

10 most popular Crypto ETFs in America

The following America-domiciled Crypto ETFs (or Crypto exposure ETFs) witnessed the most net inflows this year:

• Purpose Bitcoin ETF (BTCC.B): $234 million
• ProShares Bitcoin Strategy ETF (BITO): $160 million
• Purpose Ether ETF – USD (ETHH.U): $56 million
• Purpose Ether ETF – CAD (ETHH.B): $39 million
• Purpose Ether Yield ETF (ETHY): $27 million
• Purpose Bitcoin USD ETF Non-Currency Hedged – USD (BTCC.U): $27 million
• Bitcoin ETF – CAD (EBIT):  $25 million
• VanEck Vectors Digital Transformation ETF (DAPP): $23 million
• Bitwise Crypto Industry Innovators ETF (BITQ): $22 million
• CI Galaxy Bitcoin ETF (C$ Unhedged Series) – CAD (BTCX.B):  $16 million

The Purpose Bitcoin ETF is the world's first exchange-traded fund backed by physically settled Bitcoin – launched on February 17th, 2021. The fund has a total management expense ratio of 1.49% and trades primarily on the Toronto Stock Exchange. As of March 29th, 2022, BTCC holds over 35,490 Bitcoins.

ProShares Bitcoin Strategy ETF or BITO is the first Bitcoin-linked ETF to hit the U.S. markets. Unlike BTCC, BITO provides exposure to Bitcoin futures contracts. The fund's launch was an instant success with almost off-the-charts demand and ranking as the second heaviest-traded ETF debut on record. The fund has a total expense ratio of 0.95% and trades primarily on the NYSE Arca.

10 most popular Crypto ETPs in Europe

The following Europe-domiciled Crypto ETPs (or Crypto exposure ETFs) witnessed the most net inflows this year:

• BTCetc Bitcoin Exchange Traded Crypto ETC (BTCE): $32 million
• VanEck Vectors Avalanche ETN (VAVA): $25 million
• 21Shares Crypto Basket Index ETP (HODL): $23 million
• CoinShares Physical Ethereum (CETH): $19 million
• WisdomTree Bitcoin ETP (BTCW):  $18 million
• 21Shares Bitcoin ETP (ABTC):  $14 million
• 21Shares Ethereum ETP (AETH): $12 million
• Sygnum Platform Winners Index ETP (MOON): $8.6 million
• VanEck Vectors Ethereum ETN (VETH): $8.6 million
• CoinShares Physical Staked Tezos ETP (XTZS):  $6.6 million

BTCE is 100 % physically backed and enables investors to gain exposure to Bitcoin. BTCE has a total expense ratio of 2% and is the first centrally cleared Bitcoin ETP available on Germany's largest stock exchange, Deutsche Börse XETRA. The ETP also trades on the SIX Swiss Exchange (BTCEGBP SW, GBP or BTCECHF SW, CHF or BTCE SW, USD), the Euronext Paris (BTCE FP, EUR), and the Euronext Amsterdam (BTCE NA, USD).

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