Bitcoin ETF in Canada

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Smith1776
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Bitcoin ETF in Canada

Post by Smith1776 » Fri Feb 12, 2021 1:52 pm

Purpose Investments, which is the company that offers what is by far the best gold ETF here in Canada, will now be launching a Bitcoin ETF.

Purpose claims it's the world's first Bitcoin ETF, as the fund will directly hold Bitcoin and not use derivative instruments to gain exposure. (I didn't realize GBTC did any such thing.)

https://www.purposeinvest.com/thoughtfu ... -the-world

Cool stuff. I wonder what the expense ratio will be. Purpose is kind of famous for having the lowest expense ratio gold ETF in the whole country.
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Smith1776
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Re: Bitcoin ETF in Canada

Post by Smith1776 » Fri Feb 12, 2021 6:46 pm

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whatchamacallit
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Re: Bitcoin ETF in Canada

Post by whatchamacallit » Fri Feb 12, 2021 10:03 pm

Wow. I don't know if that means you can also buy this from US account but will this be the first opening to be able to buy bitcoin in retirement accounts?

Being able to buy bitcoin in a retirement account seems like a game changer more than the ETF itself. A lot more purchasing power in retirement accounts I would imagine.


I still just don't get it though. If halts are placed on buying companies stocks because they are considered overvalued. How can bitcoin with no underlying physical asset or earnings be allowed to trade at all?
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Ugly_Bird
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Re: Bitcoin ETF in Canada

Post by Ugly_Bird » Wed Feb 17, 2021 8:30 pm

whatchamacallit wrote:
Fri Feb 12, 2021 10:03 pm
Being able to buy bitcoin in a retirement account seems like a game changer more than the ETF itself. A lot more purchasing power in retirement accounts I would imagine.
Not an ETF but GBTC works pretty well in my IRA so far :-)
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Re: Bitcoin ETF in Canada

Post by Kbg » Thu Feb 18, 2021 8:29 am

For a bunch of reasons I'd trade futures if you can swing it. Of interest CME now has Ether futures.
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Re: Bitcoin ETF in Canada

Post by whatchamacallit » Thu Feb 18, 2021 9:50 am

Kbg wrote:
Thu Feb 18, 2021 8:29 am
For a bunch of reasons I'd trade futures if you can swing it. Of interest CME now has Ether futures.
What do you need to do special to trade futures? Accredited investor? Risk is option goes to 0?
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Re: Bitcoin ETF in Canada

Post by Kbg » Thu Feb 18, 2021 11:49 am

Get a futures account at a brokerage and fund it. As part of the process you will get the standard risk disclosure notices which you will have to read and sign in ink or digitally.

If you are conservative you can hold cash for the entire value of the future(s) which means (mostly) you are long or short the equivalent value of "the thing" the future represents. Most people do this by keeping an appropriate margin buffer in actual cash and put the rest in STTs.

Anything can go to zero so that's an immaterial statement.

The advantage to futures for cryptos is you don't need to worry about your crypto account being hacked and ripped off.

But yeah to be sure, if you know zilch about futures, you should study up first. A common caution is don't over leverage which is good advice that should be followed. However, it is completely possible to use futures and have zero leverage effectively...it's all about how you maintain your cash holdings in the account to the futures contract value.

If contract value is 50K and your cash balance is 50K then you aren't leveraged.
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Re: Bitcoin ETF in Canada

Post by Mark Leavy » Thu Feb 18, 2021 1:12 pm

Kbg wrote:
Thu Feb 18, 2021 11:49 am

The advantage to futures for cryptos is you don't need to worry about your crypto account being hacked and ripped off.
I’m not especially inclined towards cryptos, but if I ever am... that is a great tip.

I assume that by holding futures, I could also answer “no” to the question about holding cryptos on the IRS filings.

Thanks.
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Re: Bitcoin ETF in Canada

Post by Kbg » Thu Feb 18, 2021 1:47 pm

Mark,

No idea on the tax implications. If they are considered 1256 contracts then I would think the same 60/40 mark to market rules apply. That may be worth some googling time and/or looking through the CME website for these contracts. I'd be a little surprised if the CME doesn't have some info on that question.

On crypto, I'm not a huge fan as I think if it/they really does/do become a serious competitor(s) to normal currencies governments are going to wade in. Govt 101 historically...control money at all costs. If you are a government and don't control your money, you are a pretty stupid government. We can all have our personal feelings/political views on this issue, but if you step away from those, I think objectively it's almost a foregone conclusion how all this is going to end depending on how things develop.

Regardless, what IS beginning to get my attention is their correlation properties to other asset classes. If I change my mind you will see it announced with some analysis in the leveraged PP thread.
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Re: Bitcoin ETF in Canada

Post by Smith1776 » Thu Feb 18, 2021 2:03 pm

I bought a few shares of the new BTCC ETF today. Woohoo!
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Re: Bitcoin ETF in Canada

Post by bitcoininthevp » Fri Feb 19, 2021 12:45 pm

whatchamacallit wrote:
Fri Feb 12, 2021 10:03 pm
Wow. I don't know if that means you can also buy this from US account but will this be the first opening to be able to buy bitcoin in retirement accounts?

Being able to buy bitcoin in a retirement account seems like a game changer more than the ETF itself. A lot more purchasing power in retirement accounts I would imagine.
You can buy GBTC in a retirement account.

Also you can roll your retirement account into a 401K that you form (w/lawyer, etc) and buy actual BTC and hold it if youd like as well.
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Re: Bitcoin ETF in Canada

Post by Smith1776 » Tue Feb 23, 2021 2:32 pm

BTCC has gathered more than half a billion in assets in less than a week of operation.

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Re: Bitcoin ETF in Canada

Post by Ugly_Bird » Tue Feb 23, 2021 5:31 pm

bitcoininthevp wrote:
Fri Feb 19, 2021 12:45 pm
Also you can roll your retirement account into a 401K that you form (w/lawyer, etc) and buy actual BTC and hold it if youd like as well.
If just for that purpose then it is OK. But in general rollover from IRA to 401k doesn't make sense. Usually ERs there are crazy.
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