When it comes to buying cryptocurrencies like Bitcoin, Canadian investors usually resort to cryptocurrency exchanges. From there, investors can either hold Bitcoin online in their “hot wallet” for easy access or transfer it offline to a “cold wallet” for greater security.1
However, this approach cannot be implemented in a TFSA or RRSP as Bitcoin is not considered a “qualified investment” when it comes to the Income Tax Act.2 A potential way to get around this constraint and the need for self-custody of Bitcoin is via a Bitcoin exchange-traded fund (ETF).
Bitcoin ETFs are a relatively new type of investment product that debuted in Canada in 2021. These crypto funds provide investors with exposure to Bitcoin while ensuring a high degree of transparency and liquidity via the ETF structure. Here’s all you need to know before you buy your first Bitcoin ETF.
What is a Bitcoin ETF?
A Bitcoin ETF works the same as any other…
