How to buy ProShares Bitcoin Strategy units | $33.89

To buy shares in BITO, you’ll first need to sign up to a broker that allows access to the New York Stock Exchange.

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The ProShares Bitcoin Strategy ETF, the first crypto-based fund approved for US markets, started trading Tuesday, Oct. 19 on the NYSE under the symbol BITO.

While it is not the first Bitcoin ETF globally, BITO's launch in the U.S. represents a major milestone in the acceptance of Bitcoin as an investable asset.

US-based Bitcoin ETFs also open the door for more US investors to own Bitcoin. Many US brokerages do not offer access to cryptocurrency or to foreign exchanges where other crypto funds might trade, while access to US-traded ETFs is common.

The ProShares ETF is the first crypto-based fund approved by the Securities and Exchange Commission for trading in the US, after a decade of applications from ETF sponsors. Many more appear to be on the way. A second has already launched, a third is expected within days, and many more are awaiting approval or being planned.

Trading opened at $41.94, and shares traded in a range from $37.34 to $43.95 in its first few days on the market, slight underperforming Bitcoin. The target is to match Bitcoin's return.

Here's how bullish investors can get involved with this Bitcoin ETF.

How to invest in ProShares Bitcoin Strategy

  1. Compare online brokers. To invest in exchange traded funds (ETFs) listed in the United States, you'll need to sign up to an ETF broker with access to US markets. Our table below can help you choose.
  2. Open and fund your brokerage account. Complete an application with your personal and financial details. Fund your account with a bank transfer, PayPal or debit card.
  3. Search for the ProShares Bitcoin Strategy. Find the ETF by name or ticker symbol: BITO. Research its history to confirm it's a solid investment against your financial goals.
  4. Purchase now or later. Buy today with a market order or use a limit order to delay your purchase until the ProShares Bitcoin Strategy reaches your desired price.
  5. Decide on how many to buy. Weigh your budget against a diversified portfolio that can minimise risk through the market's ups and downs.
  6. Check in on your investment. Congratulations, you've invested in the ProShares Bitcoin Strategy.

Compare online ETF brokers

Name Product Standard brokerage for US shares Currency conversion fee Markets
eToro (global stocks)
US$0
50 pips (US$0.50 for every AU$100 exchanged)
Global shares, US shares, ETFs
Zero brokerage share trading on US, Hong Kong and European stocks with trades as low as $50.
Note: This broker offers CFDs which are volatile investment products and most clients lose money trading CFDs with this provider.
Join the world’s biggest social trading network when you trade stocks, commodities and currencies from the one account.
IG Share Trading
US$0
0.70%
ASX shares, Global shares
$0 brokerage for US and global shares plus get an active trader discount of $5 commission on Australian shares.
Enjoy some of the lowest brokerage fees on the market when trading Australian shares, international shares, plus get access to 24-hour customer support.
Superhero share trading
US$0
50 pips (US$0.50 for every AU$100 exchanged)
ASX shares, US shares
Earn up to 15,000 Qantas frequent flyer points when you transfer an exisiting balance or trade. Offer valid for all new and existing Superhero members until 28 February.
Pay zero brokerage on US stocks and all ETFs and just $5 (flat fee) to trade Australian shares from your mobile or desktop.
Saxo Capital Markets (Classic account)
US$4
1%
ASX shares, Global shares, ETFs
Access 19,000+ stocks on 40+ exchanges worldwide
Low fees for Australian and global share trading, no inactivity fees, low currency conversion fee and optimised for mobile.
CommSec Share Trading Account
US$19.95
0.60%
ASX shares, Global shares, Options trading, ETFs
Trade with Australia's largest online stockbroking firm.
Enjoy fast, simple and affordable trades, with market leading research and broker recommendations all in one platform
CMC Markets Invest
US$0
0.60%
ASX shares, Global shares, mFunds, ETFs
$0 brokerage on global shares including US, UK and Japan markets.
Trade up to 9,000 products, including shares, ETFs and managed funds, plus access up to 15 major global and Australian stock exchanges.
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Compare up to 4 providers

What we know about the ProShares Bitcoin Strategy

Launched by ETF issuer ProShares and headed by CEO Michael L Sapir, the fund is designed to be a simple way for investors to get exposure to the Bitcoin currency.

However, investors don’t actually own Bitcoin directly through the fund. Unlike traditional ETFs that buy and sell underlying assets such as stocks or gold, BITO uses futures contracts to profit from Bitcoin price fluctuations.

In other words, it uses contracts that speculate on the future price of Bitcoin to try to match Bitcoin's ups and down. In reality, depending on how volatile the market is and other factors, these prices could differ significantly, a somewhat unique risk.

Thus far, the Bitcoin ETFs on the US market rely on futures. ETFs that actually own Bitcoin are in the works, but it's unclear when or if the SEC will approve those.

To check out other Bitcoin-related ETFs, check out our bitcoin ETF guide.

Here's a look at how the two Bitcoin ETFs and Bitcoin itself have traded since the ETFs launched.

Are cryptocurrency ETFs a good investment?

Quick verdict

Good for
  • Allows investors to gain exposure to Bitcoin without the need for owning the underlying security
  • Avoids the hassle of setting up a Bitcoin wallet
  • Stepping stone for retail investors
  • Lower fees and more liquid than traditional crypto markets
Not so great for
  • Investors do not own Bitcoin itself
  • Being a futures contract it does not directly track the underlying asset. Instead investors trade on contracts at a predetermined price and date.

Jeff Yew, Founder & CEO at Monochrome Asset Management

Picture not described"Bitcoin as a technology is battle-tested, but there is an inherent operator's risk when self-acquiring, holding and managing a bitcoin position even for the most experienced digital native, hence there's a market for those who prefer a safe pair of hands to manage their investment in exchange for a small management fee.

"Investing in a Bitcoin ETF offers investors the benefits of a safe yet low barrier to diversifying their portfolio into the asset class since it's a well understood financial product for most investors."

Who is the ProShares Bitcoin Strategy suited for?

ProShares' ETF is suited to investors who want to gain exposure to Bitcoin without owning the underlying asset, which is Bitcoin itself.

Investors in the ProShares' ETF need to be comfortable with the fund trading future contracts, rather than actual Bitcoin. What this means is that while a rise in Bitcoin prices should mean a rise in the value of the ETF, and a drop mean a loss. neither move is guaranteed to be matched exactly by the ETF because it is trading futures.

Using the ETF is also suitable for retail investors who do not understand or want to deal with the complexities around investing and storing crypto assets, those who don't have a broker offering access to crypto, and who don't want to trade futures themselves.

Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, CFDs, options or any specific provider, service or offering. It should not be relied upon as investment advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involves substantial risk of loss and therefore are not appropriate for all investors. Trading CFDs comes with a higher risk of losing money rapidly due to leverage. Past performance is not an indication of future results. Consider your own circumstances, and obtain your own advice, before making any trades.

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