As Bitcoin earned a stable place within the investment community, Bitcoin and blockchain-focused exchange-traded funds (ETFs) have also gained investor interest. The emergence of these ETFs allows access to a broader spectrum of investors wanting exposure to these digital assets without the complications of direct asset management.
Blockchain ETFs—a type of exchange-traded product (ETP)—offer a more diversified exposure to the broader blockchain industry across sectors like finance, supply chain management, and healthcare that the technology is changing. Alternatively, Bitcoin ETFs are more focused, providing more direct exposure to the price movements of Bitcoin, the best-known cryptocurrency.
These funds either hold Bitcoin directly or track its price through futures contracts, giving investors a way to benefit from Bitcoin's price appreciation without storing the cryptocurrency themselves.
Despite these differences, media reports frequently treat the terms "Bitcoin" and "blockchain" interchangeably. As a result, it's possible to confuse blockchain ETFs and Bitcoin ETFs, although they are different financial instruments.
