Easy Access the Crypto Market in Canada: Canadian Crypto ETFs

ByDan Kent Published On:

Key takeaways

Regulated Access to Crypto – Canadian crypto ETFs trade on traditional stock exchanges, offering investors a regulated and transparent way to gain exposure. They eliminate the need for private wallets or direct cryptocurrency transactions.

Bitcoin & Ethereum Dominance – Most crypto ETFs in Canada focus on Bitcoin and Ethereum, the two largest digital assets by market capitalization. These ETFs provide exposure to the price movements of these assets without the complexities of direct ownership.

Yield-Generating Options Available – Some ETFs offer a covered-call strategy, providing additional yield through options premiums. While this can generate income, it may limit upside potential during strong market rallies.

One ETF I like way better than the ones on this list.

There are many ways to gain exposure to cryptocurrency. But lets be honest, most of them are either hard to comprehend or just outright terrify people. Many people get confused or nervous about things like a digital wallet, blockchain technologies, cryptocurrency exchanges, and just digital assets in general.

So, the fact that you can go into your brokerage account like Questrade, Qtrade, or even Wealthsimple Trade and buy cryptocurrencies in a single click of a button is a bonus.

As Canadians, we are fortunate to have several Canadian ETFs covering the most popular cryptocurrencies in the industry on the Toronto Stock Exchange. Countries like the United States have dragged their feet when it comes to ETFs, just recently releasing Bitcoin and Ethereum ETFs.

This has created some intense competition here in Canada, and we’re now left with a fee battle. Prior to this, it was extremely expensive to purchase crypto ETFs. Now, fees are continually coming down. Remember, in the ETF space, competition is nothing but good for retail investors.

Let’s dig into the top Canadian cryptocurrency ETFs available today.

These are the best cryptocurrency ETFs in Canada today

First Bitcoin ETF in the world

Purpose Bitcoin ETF (TSE:BTCC)

Launched in 2021, Purpose Bitcoin ETF (BTCC) was the first Bitcoin ETF globally, offering direct exposure to Bitcoin without the need for private keys or wallets. It directly holds Bitcoin in cold storage with a custodian and closely tracks the spot price of Bitcoin.

Fund Family: Purpose Investments Inc.

AUM: $-

Fees: 1.43%

Currency: CAD

Number of Holdings: 44

Hedged: No

5 Yr Annual Returns: 0.00%

1 Yr Fund Flows: $-

5 Yr Tax Cost Ratio: 0.00%

Yield: 0.00%

  • Direct Exposure to Bitcoin – BTCC holds Bitcoin directly, making it an easy way for investors to access the leading cryptocurrency.
  • Institutional-Grade Custody – The fund uses a trusted third-party custodian for secure storage, reducing risks associated with self-custody.
  • High Liquidity & Transparency – As the first Bitcoin ETF, BTCC enjoys strong trading volume, ensuring easy entry and exit for investors.
  • No Leverage or Derivatives – Unlike some crypto products, this ETF does not use futures, eliminating potential contango issues.
  • Regulated Investment Vehicle – Offers a compliant way to gain Bitcoin exposure, making it accessible to a broader range of investors.
  • Bitcoin Halving Events – Historically, Bitcoin halvings have led to price increases, potentially benefiting BTCC holders.
  • Institutional Adoption – Growing institutional interest in Bitcoin could drive further demand and ETF inflows.
  • Regulatory Developments – Global crypto regulations may impact demand for Bitcoin ETFs.
  • Bitcoin Volatility – BTC is highly volatile, and price swings can lead to significant short-term fluctuations.
  • Regulatory Uncertainty – Government actions could affect Bitcoin’s market dynamics and ETF accessibility.
  • Security Risks – While custody solutions are strong, cryptocurrency remains a target for cyber threats.

Direct Bitcoin exposure through a regulated ETF

iShares Bitcoin Trust ETF (IBIT:NO)

IBIT seeks to reflect the performance of the price of Bitcoin, less expenses. As a physically-backed ETF, it holds actual Bitcoin, offering investors a straightforward method to gain exposure to the cryptocurrency market without the complexities of direct ownership.

Fund Family: BlackRock Asset Management Canada Ltd

AUM: $48.185B

Fees: 0.22%

Currency: USD

Number of Holdings: 2

Hedged: No

5 Yr Annual Returns: 0.00%

1 Yr Fund Flows: $32.916B

5 Yr Tax Cost Ratio: 0.00%

Yield: 0.00%

  • Direct Exposure to Bitcoin: By holding actual Bitcoin, IBIT provides investors with price movements that closely mirror the cryptocurrency’s market value.
  • Institutional-Grade Security: Managed by BlackRock, IBIT benefits from secure custody solutions, ensuring asset protection against potential security breaches.
  • Regulatory Clarity: The approval and management of IBIT by established institutions like BlackRock signal growing acceptance of Bitcoin as a legitimate asset class, reducing regulatory uncertainties.
  • Inflation Hedge Potential: Bitcoin is often viewed as “digital gold,” offering potential protection against inflation and currency devaluation.
  • Cost-Effective Access: IBIT provides a cost-effective alternative to direct Bitcoin purchases, eliminating the need for individual cryptocurrency wallets and private key management.
  • Institutional Adoption: BlackRock’s inclusion of IBIT in its model portfolios indicates a growing institutional interest in Bitcoin, which could drive further demand and acceptance.
  • Regulatory Developments: Ongoing changes in the regulatory landscape, both in the U.S. and globally, could impact the operation and attractiveness of Bitcoin ETFs.
  • Macroeconomic Factors: Economic indicators such as inflation rates, interest rates, and monetary policies can influence Bitcoin’s appeal as an alternative asset class.
  • Market Sentiment: Investor sentiment towards cryptocurrencies, influenced by technological advancements and market dynamics, can affect Bitcoin’s price and, consequently, IBIT’s performance.
  • High Volatility: Bitcoin’s price is known for significant fluctuations, which can lead to substantial gains or losses over short periods.
  • Regulatory Changes: Future regulatory actions could impact the operation of Bitcoin ETFs, affecting their availability and attractiveness to investors.
  • Security Risks: While IBIT employs institutional-grade security measures, the inherent risks associated with digital assets, such as cyber threats, remain a consideration.
  • Market Correlation: Bitcoin’s performance may correlate with broader market trends, potentially reducing its effectiveness as a diversification tool during certain economic conditions.

Covered-call Bitcoin ETF

Purpose Bitcoin Yield ETF (TSE:BTCY)

BTCY offers exposure to Bitcoin while generating income through a covered-call strategy. This approach trades potential upside for income generation, making it appealing to income-focused investors.

Fund Family: Purpose Investments Inc.

AUM: $132.4M

Fees: 1.54%

Currency: CAD

Number of Holdings: 53

Hedged: No

5 Yr Annual Returns: 0.00%

1 Yr Fund Flows: $15.2M

5 Yr Tax Cost Ratio: 0.00%

Yield: 35.18%

  • Covered-Call Strategy for Yield – Generates income by selling call options on Bitcoin.
  • Reduced Volatility – The strategy can mitigate downside risk during market downturns.
  • Alternative to Traditional Crypto ETFs – Suitable for investors looking for passive income rather than pure price appreciation.
  • Institutional Crypto Demand – Could drive greater adoption of income-based crypto products.
  • Market Volatility & Options Premiums – Higher volatility can increase income potential.
  • Capped Upside – Covered calls limit Bitcoin’s potential price appreciation.
  • Complexity – Options strategies may be difficult for some investors to understand.

Direct Ethereum exposure

Purpose Ether ETF (TSE:ETHH)

ETHH provides direct exposure to Ethereum, holding ETH in cold storage. It is one of the most popular Ethereum ETFs in Canada, giving investors access to ETH price movements.

Fund Family: Purpose Investments Inc.

AUM: $243M

Fees: 1.44%

Currency: CAD

Number of Holdings: 36

Hedged: No

5 Yr Annual Returns: 0.00%

1 Yr Fund Flows: -$1.2M

5 Yr Tax Cost Ratio: 0.00%

Yield: 0.00%

  • Pure Ethereum Exposure – Holds ETH directly, tracking its market price.
  • DeFi & Smart Contract Growth – Ethereum’s role in decentralized finance (DeFi) and Web3 strengthens its investment case.
  • High Liquidity – One of the most traded ETH ETFs on the TSX.
  • Ethereum 2.0 & Staking – Upgrades could improve Ethereum’s long-term prospects.
  • Ethereum Volatility – ETH can experience sharp price swings.
  • Regulatory Uncertainty – Crypto regulations could impact Ethereum’s future.

Low-cost Ethereum ETF

CI Galaxy Ethereum ETF (TSE:ETHX)

ETHX provides exposure to Ethereum with a lower expense ratio than many competitors. It is designed for cost-conscious investors seeking ETH exposure.

Fund Family: CI Investments Inc

AUM: $423.7M

Fees: 0.77%

Currency: CAD

Number of Holdings: 2

Hedged: No

5 Yr Annual Returns: 0.00%

1 Yr Fund Flows: -$156.1M

5 Yr Tax Cost Ratio: 0.00%

Yield: 0.00%

  • Low Management Fees – Reduces long-term costs for Ethereum investors.
  • Institutional-Grade Custody – Secure storage of ETH holdings.
  • Ideal for Cost-Sensitive Investors – Lower expense ratios improve returns over time.
  • Ethereum 2.0 & Staking Growth – The transition to Ethereum 2.0 has introduced staking, making ETH a yield-generating asset. More institutions and retail investors are staking ETH, which could reduce circulating supply and drive price appreciation.
  • Institutional Adoption of Ethereum – Large financial institutions are increasingly integrating Ethereum for smart contracts, decentralized finance (DeFi), and tokenization. Continued adoption could lead to higher demand for ETH.
  • Layer-2 Scaling Solutions – Technologies like Optimistic Rollups and zk-Rollups aim to improve Ethereum’s transaction speeds and reduce fees. Successful implementation could increase Ethereum’s competitiveness.
  • Ethereum Price Volatility – ETH is known for its large price swings, which can result in significant short-term losses. Market sentiment, macroeconomic conditions, and technological developments all contribute to its unpredictability.
  • Regulatory Uncertainty – Governments worldwide are still defining their stance on Ethereum and other cryptocurrencies. If ETH is classified as a security in certain jurisdictions, it could face stricter regulations, impacting adoption and price stability.
  • Competition from Other Blockchains – Ethereum faces growing competition from alternative Layer-1 blockchains such as Solana, Avalanche, and Polkadot. These platforms offer faster transaction speeds and lower fees, which could reduce Ethereum’s dominance.

Covered-call Ethereum ETF

Purpose Ether Yield ETF (TSE:ETHY)

ETHY follows a covered-call strategy, generating income while offering Ethereum exposure. It appeals to investors seeking yield instead of pure ETH price appreciation.

Fund Family: Purpose Investments Inc.

AUM: $48M

Fees: 1.53%

Currency: CAD

Number of Holdings: 51

Hedged: No

5 Yr Annual Returns: 0.00%

1 Yr Fund Flows: $9.6M

5 Yr Tax Cost Ratio: 0.00%

Yield: 76.63%

  • Income Generation from Covered Calls – ETHY generates regular income by selling covered-call options on a portion of its Ethereum holdings. This provides investors with cash flow, making it an attractive choice for those seeking yield.
  • Lower Volatility Compared to Pure ETH ETFs – The covered-call strategy reduces volatility by providing downside protection. While ETH prices can swing dramatically, the options premiums help cushion declines.
  • Exposure to Ethereum’s Long-Term Growth – ETHY still provides exposure to Ethereum’s price movements, allowing investors to benefit from the network’s adoption in DeFi, NFTs, and Web3.
  • Attractive for Conservative Crypto Investors – Unlike pure Ethereum ETFs that fully rely on price appreciation, ETHY offers an additional return stream from options writing, making it more appealing to income-focused investors.
  • Ethereum 2.0 & Staking Growth – The transition to proof-of-stake has introduced staking rewards, which compete with ETHY’s yield strategy. Increased staking participation could impact the ETF’s attractiveness if yields from staking become higher than options premiums.
  • Institutional Adoption of Ethereum – More institutions are integrating Ethereum for smart contracts, DeFi applications, and asset tokenization. Increased institutional demand could drive higher ETH prices, benefiting ETHY investors.
  • Layer-2 Scaling Solutions – Rollups like Optimism and Arbitrum are improving Ethereum’s scalability, reducing transaction costs, and increasing network adoption. If these solutions gain traction, Ethereum could see broader institutional and retail adoption.
  • Capped Upside Potential – The covered-call strategy generates income but limits maximum gains. In a strong Ethereum bull market, ETHY may underperform standard Ethereum ETFs that fully capture ETH’s price appreciation.
  • Ethereum Price Volatility – Despite income generation from options premiums, ETHY is still exposed to Ethereum’s price swings. If ETH experiences a prolonged bear market, ETF returns may be negatively impacted.
  • Regulatory Risks – Governments could impose stricter regulations on Ethereum, affecting its adoption and price. Any classification of ETH as a security could impact institutional investment and liquidity.

Bitcoin & Ethereum dual exposure

Evolve Cryptocurrencies ETF (TSE:ETC)

Evolve Cryptocurrencies ETF (ETC) is a hybrid crypto ETF that provides exposure to both Bitcoin (BTC) and Ethereum (ETH) in a single product. It simplifies crypto investing for those who want diversified exposure to the two largest digital assets without purchasing separate ETFs. The fund dynamically allocates between BTC and ETH based on market conditions, offering a balanced approach to crypto investing.

Fund Family: Evolve Funds Group Inc

AUM: $63.2M

Fees: 1.13%

Currency: CAD

Number of Holdings: 11

Hedged: No

5 Yr Annual Returns: 0.00%

1 Yr Fund Flows: $14.6M

5 Yr Tax Cost Ratio: 0.00%

Yield: 0.04%

  • Diversified Crypto Exposure – Instead of choosing between Bitcoin and Ethereum, ETC holds both, reducing concentration risk and providing exposure to the two most dominant cryptocurrencies.
  • Simplified Investment Approach – Investors can gain exposure to BTC and ETH through a single ETF, eliminating the need to manage separate holdings. This is especially beneficial for those new to crypto investing.
  • Direct Holdings of BTC & ETH – Unlike futures-based ETFs, ETC holds physical Bitcoin and Ethereum, closely tracking their spot prices without the risks associated with derivatives like contango.
  • Rebalanced Allocation Strategy – The fund dynamically adjusts its holdings between Bitcoin and Ethereum based on market trends, aiming to optimize returns over time.
  • Institutional Adoption of Crypto – More companies and financial institutions are integrating Bitcoin and Ethereum into their portfolios. Increased institutional investment could drive demand for ETFs like ETC.
  • Bitcoin’s Role as Digital Gold – BTC continues to gain recognition as a store of value, particularly during periods of inflation and economic uncertainty. If this narrative strengthens, BTC’s price—and ETC’s value—could benefit.
  • Ethereum’s Growth in DeFi & Web3 – Ethereum remains the leading blockchain for decentralized finance (DeFi) and Web3 applications. As these sectors expand, ETH demand could increase, boosting ETC’s performance.
  • Crypto Market Volatility – Both Bitcoin and Ethereum are highly volatile assets, and their prices can experience significant fluctuations. This ETF is exposed to the risks of both assets simultaneously.
  • Regulatory Uncertainty – Governments may impose new regulations on Bitcoin, Ethereum, or cryptocurrency ETFs, potentially affecting accessibility and adoption. Stricter policies could lead to price declines.
  • Bitcoin vs. Ethereum Performance Divergence – While BTC and ETH often move in tandem, one may outperform the other in certain market cycles. If the ETF is overweight in the underperforming asset, it may lag behind single-asset crypto ETFs.
  • Competition from Single-Asset ETFs – Investors who prefer to maximize exposure to either BTC or ETH may opt for specialized ETFs instead of ETC, reducing its demand.

Should I buy a cryptocurrency ETF or simply the cryptocurrency itself?

Many experienced investors and those learning how to buy stocks looking to add cryptocurrency to their investment strategies often already have an account set up. Whether it be a TFSA, RRSP, or cash account, you can buy crypto ETFs with a single click of a button.

There is certainly a convenience factor when it comes to cryptocurrency ETFs. And another large benefit to purchasing the ETF, especially in a tax-sheltered account, is that your gains will be tax-free.

The same cannot be said if you buy cryptocurrency on a platform like Bitbuy. Although you can claim capital losses if your crypto investment goes south, you will also be forced to pay capital gains if you sell for profit.

Simply put, you need to weigh the pros and cons of purchasing cryptocurrency in a taxable account or taking advantage of the tax opportunity and buying these crypto ETFs in a tax-sheltered account.