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Cons of Bitcoin Spot ETF
When you purchase ETFs, you don't own the underlying Bitcoin, thus limiting your control over your investment. The Bitcoins held in the ETF are all under custodial ownership, which means if the custodian were to suffer from a security breach or loss of access, it would greatly affect the investors holding the ETFs.
While investing in spot bitcoin ETFs could save you the time and costs of exchanging and securing Bitcoins yourself, these ETFs do charge management fees or expense ratios to cover operational costs, diminishing your returns over time. These fees can be higher than traditional equity ETFs because the ETF must also pay fees for the trading and custodial fees of the exchange.
Is Bitcoin Spot ETF for me, you and all investors?
The Bitcoin Spot ETFs represent a significant evolution in cryptocurrency, offering a regulated and simplified way to gain exposure to bitcoin’s prices. However, convenience does comes additional costs with management fees.