Introduction
Investing in Bitcoin through Exchange-Traded Products (ETPs) offers a regulated and accessible pathway to cryptocurrency exposure. This comparison analyzes two prominent EU-listed Bitcoin ETPs: CoinShares Physical Bitcoin (BITC) and 21Shares Bitcoin Core ETP (21BC), evaluating their structures, costs, and suitability for different investor profiles.
ETF Overviews
BITC - CoinShares Physical Bitcoin
- Type: Exchange-Traded Note (ETN)
- Underlying Asset: Physical Bitcoin holdings
- Expense Ratio: 0.35%
- Inception: January 19, 2021
- Key Feature: Collateralized debt obligation backed by physical Bitcoin, providing direct price tracking.
21BC - 21Shares Bitcoin Core ETP
- Type: Exchange-Traded Product (ETP)
- Underlying Asset: Bitcoin
- Expense Ratio: 0.21%
- Inception: June 29, 2022
- Key Feature: Lower-cost option with a focus on transparent Bitcoin exposure.
Detailed Comparison
| Metric | BITC | 21BC |
|---|---|---|
| Provider | CoinShares | 21Shares |
| Index | Bitcoin | Bitcoin |
| Asset Class | Cryptocurrency | Cryptocurrency |
| Listing | EU-listed | EU-listed |
| Expense Ratio | 0.35% | 0.21% |
| Currency | USD | USD |
| Leverage | Non-leveraged | Non-leveraged |
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Key Investment Considerations
- Cost Efficiency: 21BC’s lower expense ratio (0.21% vs. 0.35%) may appeal to long-term investors.
- Track Record: BITC has a longer operational history (2021 vs. 2022).
- Structure: BITC uses physical Bitcoin collateral, while 21BC employs a synthetic ETP model.
Performance and Risk Analysis
Note: Backtesting results are hypothetical and require real-time data for accurate metrics.
Hypothetical Metrics (Illustrative)
- Cumulative Returns: Dependent on Bitcoin’s volatility.
- Risk-Adjusted Returns: Sharpe/Sortino ratios vary with market conditions.
- Drawdowns: Cryptocurrency ETPs may experience significant downturns during bear markets.
FAQs
1. Which ETP is better for cost-conscious investors?
Answer: 21BC’s 0.21% expense ratio makes it more cost-effective than BITC (0.35%).
2. How do these ETPs handle Bitcoin storage?
Answer: BITC holds physical Bitcoin, while 21BC uses a custodian-backed structure.
3. Are these ETPs available globally?
Answer: Both are EU-listed but accessible to international investors via brokerage accounts.
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Conclusion
BITC and 21BC offer distinct advantages—BITC with its physical collateral and 21BC with lower fees. Investors should align their choice with cost tolerance and risk appetite. For deeper insights, consult a financial advisor.
Disclaimer: Past performance does not guarantee future results. Cryptocurrency investments carry high volatility risk.