If you follow investing news, you will more than likely know about the spot Bitcoin ETF. This has seen Bitcoin’s meteoric rise and starting out the year at just over USD $45,000. This has caught the attention of many investors. But, the ETF begs the question, should you just buy and hold your own crypto or go through a fund manager?
What is the spot Bitcoin ETF?
Simply put, a spot Bitcoin exchange-traded fund (ETF) is a financial instrument through which regular investors can get exposure to Bitcoin via brokerage accounts. In this instance, the underlying asset is Bitcoin as asset managers buy Bitcoin directly and it makes up the fund’s underlying asset.
Not Your Keys, Not Your Coins
When you dive into the world of cryptocurrency, “Not Your Keys, Not Your Coins” is a phrase that you will very quickly come across. Without going into too much detail, cryptocurrencies as stored in wallets which contain public and private keys. The public key is the address assets are sent to (like a bank account) and the private key gives you access to the funds to do with as you please. The phrase refers to the private key.
That said, when investing in a Bitcoin spot ETF, you get a digital record (for lack of a better word) to say that you have claims in a fund that has claims to Bitcoin (on your behalf). You don’t actually own any Bitcoin.
One thing that all funds come with is fees which may include trading fees (or brokerage fees depending on which terminology you prefer to use) when buying and selling and expense ratio (which includes management fees and operating costs).
If you are thinking about investing a spot Bitcoin ETF, the above should be taken into consideration. Do you want to be able to do what you want with your Bitcoin whenever you want? Do you want to be paying fees on something that you can hold yourself at no cost?
On the other side of the coin is buying and holding Bitcoin yourself. For someone new to it, it may seem complicated and daunting but is it really?
Learning about cryptocurrency
Just like most things in life, if you are interested in something new, you’ll more than likely have to take some time to learn about it. There are several ways of learning new things which include but aren’t limited to researching online, enrolling in a course, and talking to people already doing whatever it is.
Buying Bitcoin in New Zealand
A safe and easy way to buy Bitcoin in NZ is through EasyCrypto. They are a trusty NZ-based platform whose founders don’t hide who they are and what they are all about. The platform is not an exchange so when you purchase Bitcoin it is sent directly to your wallet. They have a simple and intuitive interface which streamlines the path to owning Bitcoin.
EasyCrypto has a wealth of resources on all things crypto. They have NZ-based (mostly) customer support if you run into any issues as well as a very helpful and supportive community (a Facebook group that they’ll direct you towards in a welcome email when you sign up). As already mentioned, one good way to learn something new is to surround yourself with people who are doing it. The Facebook group is a perfect place to ask anything and everything crypto; there really are no ‘silly’ or ‘newbie’ questions, and the community is always willing to help
Easy Crypto makes it easy for you to buy, sell and exchange over 160+ cryptocurrencies
At the end of the day, the choice between a Bitcoin spot ETF and acquiring Bitcoin through EasyCrypto comes down to autonomy and accessibility.
Depending on where you are in your crypto journey, direct ownership may mean investing time in learning. It’s either you get stuck with you past knowledge and stay where you are in life. Or, you could make up your mind, take a risk, sign up, learn, apply learning, test out the waters, experience it, maybe make mistakes (also a great way to learn), learn as you go and see how you go.
There’s no harm in giving self-custody a try. Sign up to EasyCrypto, buy a small amount of Bitcoin and see how you go.
[…] these funds are U.S.-based, Kiwi investors who don’t want to hold their own Bitcoin can readily participate in the market through New Zealand investment […]