The cryptocurrency market has matured significantly since Bitcoin’s early days, with institutional investors increasingly seeking regulated exposure to digital assets. For retail investors looking to gain diversified crypto exposure without directly holding tokens, exchange-traded funds (ETFs) have emerged as a compelling option, particularly those priced under $100 per share.
After spending the past week analyzing the current landscape of cryptocurrency ETFs, I’ve identified several standout options that balance innovation, accessibility, and regulatory compliance while maintaining share prices below the $100 threshold.
The Evolution of Crypto ETFs
The approval of spot Bitcoin ETFs by the SEC in January 2024 marked a watershed moment for cryptocurrency legitimacy. Unlike previous futures-based products, these spot ETFs directly hold Bitcoin, providing investors with more authentic exposure to the asset’s performance.
“Spot crypto ETFs represent a significant evolution in how traditional investors can access digital assets,” explains Sheila Warren, CEO of the Crypto Council for Innovation, whom I spoke with at the recent Consensus conference in Austin. “They’re bridging the gap between traditional finance and the crypto ecosystem.”
This evolution has created a spectrum of investment vehicles offering different approaches to crypto exposure, from single-asset focused funds to more diversified offerings that spread risk across multiple digital assets.
Top Contenders Under $100
Among the most compelling options in the sub-$100 category is the Bitwise Crypto Industry Innovators ETF (BITQ), currently trading around $74. Unlike pure Bitcoin ETFs, BITQ provides exposure to companies actively involved in the cryptocurrency and blockchain ecosystem.
The fund holds positions in crypto exchanges like Coinbase, mining operations such as Riot Platforms, and infrastructure companies building the backbone of the digital asset space. This approach offers investors indirect exposure to crypto growth without the extreme volatility of holding tokens directly.
Another standout option is the Amplify Transformational Data Sharing ETF (BLOK), trading at approximately $66 per share. BLOK takes a broader approach by investing in companies developing and utilizing blockchain technologies across various sectors, including finance, supply chain, and healthcare.
“What makes BLOK interesting is its active management approach,” notes Ryan Selkis, founder of Messari, in his recent market analysis. “The fund can adapt its holdings as the blockchain landscape evolves, potentially capturing emerging opportunities faster than passive indexes.”
For investors seeking more direct cryptocurrency exposure while maintaining diversification, the Valkyrie Bitcoin and Ether Strategy ETF (BTF) offers an interesting proposition at roughly $82 per share. The fund uses futures contracts to provide exposure to both Bitcoin and Ethereum, capturing the two largest cryptocurrencies that together represent over 60% of the total crypto market capitalization.
Risk Considerations
Despite the convenience and regulated nature of crypto ETFs, investors should remain mindful of several risk factors. The underlying volatility of cryptocurrency markets affects these funds, though often to a lesser degree than direct token ownership.
Management fees also vary significantly across crypto ETFs, with expense ratios typically ranging from 0.25% to 1.25% annually. These fees can meaningfully impact long-term returns, especially during market consolidation phases.
Regulatory uncertainty presents another consideration. While spot Bitcoin ETFs have received approval, the regulatory environment for broader crypto assets remains in flux. As I learned from discussions with industry compliance experts at the Financial Innovation Forum last month, regulatory developments could significantly impact fund structures and operations.
Strategic Allocation Approaches
Financial advisors increasingly recommend a measured approach to crypto ETF exposure. According to a recent CoinDesk survey of financial planners, most suggest limiting crypto allocation to between 1% and 5% of a diversified portfolio, depending on individual risk tolerance.
“Crypto ETFs should be viewed as a satellite position in most portfolios,” advises Michael Sonnenshein, CEO of Grayscale Investments, in a Bloomberg interview. “They offer an opportunity for potential upside exposure while limiting concentration risk.”
For investors particularly concerned about volatility, dollar-cost averaging into positions can help mitigate timing risk. This approach involves regularly purchasing shares regardless of price, potentially reducing the impact of market fluctuations over time.
The Broader Investment Context
When evaluating crypto ETFs, it’s essential to consider the broader economic environment. Cryptocurrency markets have historically shown sensitivity to macroeconomic factors including inflation rates, monetary policy decisions, and regulatory developments.
The current interest rate environment and inflation outlook may influence the performance of crypto assets and, by extension, related ETFs. As traditional finance increasingly intersects with digital assets, these correlations merit close attention.
Cryptocurrency ETFs under $100 offer an accessible entry point into digital asset exposure through regulated vehicles. While no investment comes without risk, these instruments provide a bridge between traditional finance and the evolving digital asset ecosystem, potentially offering a balanced approach to participating in blockchain innovation while managing direct cryptocurrency exposure risks.
As with any investment decision, due diligence on fund structure, holdings, management approach, and fee structures remains essential before committing capital.
