ETF News

Over in the U.S., the iShares Bitcoin Trust ETF (IBIT) has achieved remarkable success, swelling to over $51 billion in assets under management (AUM) just over a year since its January 2024 launch. This makes it one of the most successful ETF launches to date.

Now, Canadian investors can join in that success with a Canadian dollar-denominated version of IBIT, which is trading on the Cboe Canada exchange.

“Cboe has a history of bringing many first-of-their-kind products to market, including spot crypto ETFs in the United States, and we’re thrilled to continue our leadership in innovation by listing BlackRock Canada’s IBIT ETF on Cboe Canada,” said Rob Marrocco, Global Head of ETF Listings at Cboe.

Here’s what you need to know about this standout spot Bitcoin ETF.

IBIT 101

IBIT is a spot Bitcoin ETF, meaning it doesn’t rely on derivatives like Bitcoin futures for exposure. Instead, it directly holds actual Bitcoin with its custodians. When you buy a share, you’re directly exposed to the spot price of Bitcoin.

IBIT seeks to track the CME CF Bitcoin Reference Rate – New York Variant, a widely recognized Bitcoin pricing benchmark minus fees and expenses.

This ETF is generally as liquid as comparable ETFs, allowing you to buy and sell shares on most brokerage platforms, just like any stock.

However, unlike U.S. spot Bitcoin ETFs, IBIT trades in Canadian dollars, providing a cost-effective solution for Canadian investors.

With the Canadian dollar at a low versus the U.S. dollar, you can avoid the costly exchange rates and brokerage commissions often associated with investing in U.S.-denominated Bitcoin ETFs. IBIT is a simpler and more affordable alternative.

IBIT is cheaper

One of the biggest advantages of IBIT is its competitively priced management fee. Compared to other TSX-listed spot Bitcoin ETFs, IBIT stands out as the most cost-effective option:

Fees matter, especially for long-term investors. Every basis point saved on management fees is another that stays in your pocket. Over time, these savings can compound significantly.

For those committed to holding Bitcoin exposure for the long haul, choosing the lowest-cost ETF is the a strong consideration, all else being equal.

IBIT is reliable

With IBIT, you benefit from the trusted BlackRock brand name, eliminating the need to worry about self-custody or dealing with cryptocurrency exchanges.

Backed by the world’s largest asset manager, IBIT is built on multi-year technology integration developed with Coinbase Prime, the world’s largest institutional digital asset custodian. This ensures security and reliability for your Bitcoin exposure.

Moreover, unlike direct cryptocurrency ownership, IBIT is eligible for registered accounts like the Tax-Free Savings Account (TFSA), Registered Retirement Savings Plan (RRSP), and First Home Savings Account (FHSA).

This makes it a more tax-efficient option for Canadian investors looking to add Bitcoin exposure to their portfolios, as gains can grow tax-free or tax-deferred depending on the account type.

“Investors increasingly seek crypto exposure through exchange-listed wrappers, and Cboe intends to meet this demand by leveraging both our global listings capabilities and our derivatives expertise to broaden market access and grow the crypto ecosystem with new products,” Marrocco said.

Please note this article is for information purposes only and does not in any way constitute investment advice. It is essential that you seek advice from a registered financial professional prior to making any investment decision. Information cited herein is current as of the date of this article’s publication. You should refer to the IBIT prospectus dated January 3, 2025, for full details

The information provided is for general education and information purposes only. No statement provided should be construed as a recommendation to buy or sell a security, future, financial instrument, investment fund, or other investment product (collectively, a “financial product”), or to provide investment advice. Past performance of an index or financial product is not indicative of future results.