Cryptocurrencies are becoming more widely recognized as a method of exchange worldwide, with numerous multibillion-dollar corporations already accepting Bitcoin payments. And after China effectively shut down the Chinese crypto industry by outlawing Bitcoin—the largest cryptocurrency—the United States has emerged as the world’s new mining capital, accounting for 35% of the worldwide hash rate, which is a measure of the aggregate computational power of miners.
Following a near-all-time high rally, Bitcoin fell below $16,200 post-Thanksgiving. This was purportedly linked to Chinese authorities retrieving $4.2 billion in cryptocurrencies as part of the Plustoken Ponzi scheme. However, the recent price dip could be viewed as an opportune time to invest in cryptocurrencies. In addition, as investors’ interest in high-flying digital currencies continues to grow, the global cryptocurrency mining market is projected to grow at an 11.5% rate over the next seven years.
Since it’s challenging to choose the best cryptocurrency, we think investors seeking to cash in on the favorable crypto trends in a less risky manner could bet on quality crypto funds Grayscale Bitcoin Trust (GBTC) and Amplify Transformational Data Sharing ETF (BLOK).
Click here to check out our Cryptocurrency Industry Report for 2021
Grayscale Bitcoin Trust (GBTC)
GBTC is the largest digital currency asset manager globally. The company’s collection of investment products enables access and exposure to the digital currency asset class in the form of securities, thereby eliminating the difficulties of buying, storing, and safeguarding digital currencies directly. The fund has approximately $35.68 billion in assets under management (AUM).
The fund charges a 2% annual fee. GBTC closed its last trading session at $41.85. The ETF has returned 74.4% over the past year and 30.8% so far this year.
Amplify Transformational Data Sharing ETF (BLOK)
BLOK is among the few funds that invest in blockchain-related companies. Rather than investing directly in volatile digital currencies, BLOK seeks companies involved in developing and implementing blockchain technology. It has approximately $1.59 billion in AUM. BLOK’s major holdings include Silver Gate Capital Corp. (SI), Coinbase Global Inc. (COIN), and NVIDIA Corporation (NVDA).
BLOK has an expense ratio of 0.71%, which exceeds the 0.55% category average. The ETF has gained 63.1% over the past year and 42.1% year-to-date. It pays $0.66 in dividends annually, translating to an annual dividend yield of 1.1%.
BLOK closed the last trading session at $49.72, which is 23.4% lower than its 52-week high of $64.91. The fund has generated a net inflow of $148.93 million over the past month.
Click here to check out our Cryptocurrency Industry Report for 2021
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GBTC shares were trading at $38.74 per share on Monday morning, down $3.11 (-7.43%). Year-to-date, GBTC has gained 21.06%, versus a 23.68% rise in the benchmark S&P 500 index during the same period.
About the Author: Pragya Pandey
Pragya is an equity research analyst and financial journalist with a passion for investing. In college she majored in finance and is currently pursuing the CFA program and is a Level II candidate. More...
More Resources for the Stocks in this Article
| Ticker | POWR Rating | Industry Rank | Rank in Industry |
| GBTC | Get Rating | Get Rating | Get Rating |
| BLOK | Get Rating | Get Rating | Get Rating |
