The volatility of cryptocurrency prices over the past four years is a both a feature and a bug of the broader industry’s growth. Volatility is reflected in the many bitcoin and crypto ETFs developed to capitalize on the growth of digital assets.
The good news is cryptocurrencies have normalized after rebounding from late 2022 and early 2023 lows and entering 2024 with strong momentum.
The two largest cryptocurrencies by assets – Bitcoin (BTC/USD) and Ethereum (ETH/USD) – are up significantly in the last 12 months to trade near new highs, with much less volatility to show for their gains.
That’s excellent news if you’re a long-term investor.
Bitcoin and crypto ETFs benefit from an AI boost
Helping the entire digital assets arena is the global push into artificial intelligence (AI) by companies of all sizes.
AI is the secular trend that could be the crypto and blockchain industry’s savior.
Consider Vancouver-based crypto miner Hive Blockchain Technologies (HIVE), which changed its name to Hive Digital Technologies to better reflect the use of its high-performance data centers to fuel the processing power needed for generative AI tools.
Moves like these are part of the ongoing Web3 maturation process. And it’s a positive development for future cryptocurrency investments, including the best bitcoin and crypto ETFs that provide investors exposure to the space.
At the same time, crypto is slowly gaining regulatory acceptance. The most notable example remains the January 2024 decision by the Securities and Exchange Commission to approve spot bitcoin ETFs. These are exchange-traded funds that are tied to the digital assets spot price – or where it is trading at right now so that it can be bought for immediate delivery.
This differs from futures prices, which are where the cryptocurrency is expected to be trading in the future. Futures traders buy contracts that lock in this price for a delivery of the asset at a later date. The SEC had previously rejected approving a spot bitcoin ETF, citing risks such as market manipulation and fraud.
It should go without saying that bitcoin and other digital assets remain highly speculative and should be approached with extreme caution.
However, those interested in more risk-averse options might consider these best bitcoin and crypto ETFs.
Asset levels and prices might be lower than they were at the height of the crypto surge in late 2021. But they’re returning due to promising new technologies such as AI.
Data is as of October 23 unless otherwise indicated.
