Crypto Christmas: 3 Best Cryptocurrency ETFs To Buy Now

Summary Bitcoin surpassed $100,000 for the first time this month as political winds shifted in cryptocurrency’s favor following the U.S. presidential election. Crypto ETFs offer exposure by investing directly in the assets and/or companies involved in the digital economy. Crypto has been considered a higher-risk investment. Yet, as more regulatory acceptance is achieved, exposure to crypto may offer investors an opportunity to capitalize on the growth of digital assets. Three crypto-focused ETFs, with an average one-year return of +146%, possess incredible momentum and offer investors exposure to a diverse range of crypto and crypto-linked assets. Based on SA’s Quant Ratings, these ETFs possess incredible momentum. Christmas Comes Early for Crypto Fans Every year, investors hope for a ‘Santa Claus Rally’ – the historical (but never guaranteed) phenomenon in which the stock market jolts in value during the last week of December and the first few trading days of the new year. Cryptocurrency holders need not wait. Christmas has come early for crypto enthusiasts as the presidential victory of Donald Trump, who has pledged to make America “the crypto capital of the planet,” has sent the prices of digital coins soaring. According to crypto data provider CoinGecko, the global cryptocurrency market’s value eclipsed $3T for the first time in three years last month, as investors rejoiced at the potential of easing regulatory restrictions on the industry in U.S. Bitcoin ( BTC-USD ) surged to an all-time high of over $100,000 on December 5, topping only its previous record from the day after election day. The Total Market Value of All Cryptocurrencies Exploded in November Seeking Alpha Premium Meanwhile, the resignation of SEC chair Gary Gensler, whom Trump plans to replace with crypto bull Paul Atkins, is set to shift the balance of power at the securities watchdog to a Republican majority – another reason for Wall Street to celebrate as Trump taps financiers like hedge fund executive Scott Bessent as Treasury pick. Regardless of how many crypto campaign promises Trump manages to keep, many analysts believe that crypto’s bull run will continue well into 2025. One such expert is Geoff Kendrick, head of Crypto Research at Standard Chartered Bank, who recently predicted that Bitcoin could reach $200,000 by the end of next year. Digital assets could offer an opportunity for investors looking to gain in a unique space achieving more regulatory acceptance “fairly quickly.” Investing in Cryptocurrency As Bitcoin and other digital currencies benefit from the global artificial intelligence push and crypto gains regulatory acceptance, investors wanting some exposure to the space may want a more accessible solution than navigating the complex universe of crypto exchanges and digital wallets. Crypto ETFs, which track the performance of one or more digital currencies and are traded on traditional stock exchanges, which can help with some of the regulatory risks associated with trading on unregulated crypto exchanges, though market risk is still involved. Some key features of crypto ETFs include: Accessibility – Crypto ETFs are traded like stocks on traditional exchanges and can therefore be accessed through brokerage accounts. Regulation – Trading through traditional exchanges offers greater regulation by financial authorities than directly holding crypto, subject to less security and oversight. Diversification – ETFs often include multiple cryptocurrencies and holdings, offering diversification rather than single-asset investments. Seeking Alpha’s Quant ETF Grades are generated by a proprietary system that aims to provide investors with an instant characterization of each ETF. The SA quant system grades organize the market’s Top ETFs by five factors: Momentum, Expenses, Dividends, Risk, and Liquidity. Key ETF metrics are systematically gathered and compared to the median of all ETFs, then assigned a grade from A+ to F. Investors can also use advanced filters to view various ETF asset classes and subclasses, including digital assets. Cryptocurrency-focused ETFs invest directly in digital assets or indirectly in miners and stocks involved in crypto. Although crypto ETFs have strong momentum, investors should realize they are also highly volatile, as demonstrated by their ‘F’ Risk Grades, and subject to expenses, which typically include management fees, custodian charges for holding the fund’s assets, and fees and expenses from fund administrators, auditors, etc. Seeking Alpha Premium The SA Quant Team identified three ETFs that expose investors to a wide range of crypto assets. All of them have ‘Strong Buy’ or ‘Buy’ ratings and excellent momentum, evidenced by a market-crushing average one-year price performance of +146%. Seeking Alpha’s Crypto ETF Recommendations on Par With Major Index Providers Seeking Alpha Premium Furthermore, SA Quant’s charting feature allows you to compare top ETFs alongside one another. Below, you can see our three crypto ETF picks, OTC:BITW , BTF , and WGMI , have kept up with and, at times, outperformed ETFs run by major index providers, including the Fidelity Crypto Industry and Digital Payments ETF (FDIG) and Schwab Crypto Thematic ETF (STCE) on a year-to-date basis. Let’s dive into the first ETF. 1. Bitwise 10 Crypto Index Fund ETF Assets ((AUM)): $1.44B Quant Rating: Strong Buy Quant Ranking in Asset Class (as of 12/12/24): 2 out of 257 Quant Ranking in Asset Sub Class (as of 12/12/24): 2 out of 38 Ranked number two in both the Alternative asset class and Digital sub class, the Bitwise 10 Crypto Index Fund ETF offers a diversified mix of 10 crypto holdings . Bitcoin (70%) and Ethereum (17.1%) account for nearly 90% of its total value, with smaller holdings in Solana, XRP, Cardano, Avalanche, Chainlink, Polkadot, Bitcoin Cash, and NEAR Protocol. Bitwise Up more than 187.18% in the past 12 months, this basket of cryptocurrencies has ridden the wave of Bitcoin’s multiple rallies, touting an impressive ‘A+’ Momentum Grade and crushing the sector median with a 183.16% 1Y total return. It has also outperformed Bitcoin outright, which returned 146.11% over the same period. Seeking Alpha Premium BITW also has an above-average Liquidity Grade of ‘B+’ with a daily dollar volume of $5.29M– 276.16% above the $1.4M sector median. 2. CoinShares Valkyrie Bitcoin and Ether Strategy ETF Assets ((AUM)): $54.73M Quant Rating: Strong Buy Quant Ranking in Asset Class (as of 12/12/24): 5 out of 257 Quant Ranking in Asset Sub Class (as of 12/12/24): 5 out of 38 Up 87.59% YTD and 68.12% over the past 12 months, the CoinShares Valkyrie Bitcoin and Ether Strategy ETF boasts double-digit performance while offering individual investors easy access to the world’s two largest digital assets, Bitcoin and Ethereum ( ETH-USD ). BTF has notched a one-month total return of 13.45%, a 2,083.02% difference to the 0.62% sector median, and a similarly sector-crushing 1Y total return of 94.58% to earn it an ‘A+’ in Momentum Grade. The fund’s impressive ‘A’ Dividend Grade offers an attractive 9.21% dividend yield and an incredible 1,105.39% dividend growth rate, a 12,632.90% difference from the 8.68% sector median. Seeking Alpha Premium 3. CoinShares Valkyrie Bitcoin Miners ETF Assets ((AUM)): $236.73M Quant Rating: Buy Quant Ranking in Asset Class (as of 12/12/24): 17 out of 258 Quant Ranking in Asset Sub Class (as of 12/12/24): 17 out of 38 CoinShares Valkyrie Bitcoin Miners ETF invests in the B itcoin mining industry. Bitcoin mining is an interesting option for investors looking to back the cryptocurrency industry without direct exposure to Bitcoin itself. The fund invests in nine companies , with more than 50% of its portfolio concentrated within its top four holdings: IREN Ltd, Core Scientific Inc, Cipher Mining Inc, and Cleanspark Inc. WGMI Holdings (as of 12/11/24) Seeking Alpha Premium Up 123.62% over the past 12 months and making SA’s list of Best-Performing Actively Managed ETFs , WGMI has consistently charted strong total return and price performance, contributing to its ‘A+’ Momentum Score . WGMI also demonstrates strong liquidity , with an average daily dollar volume of 12.36M, 778.23% higher than the sector median of 1.4m, and an average daily share volume of 512.52K, a noteworthy 1,316.45% higher than the 36.18K sector median. While all three of these ETFs make for compelling choices according to SA’s Quant system, investing in crypto comes with serious risks that every investor should consider. Risks While 2025 will inevitably be an exciting year for cryptocurrency, it is important to consider the risks involved, as these assets are highly volatile and can often be extremely speculative. The SEC’s Office of Investor Education and Advocacy “ continues to urge investors to be cautious if considering an investment involving crypto asset securities.” Where mainstream adoption has catapulted many digital assets to new highs, as Seeking Alpha analyst Joseph Calhoun said , “In today’s wild west of finance, even conservative investors can get taken,” so always invest knowing the possibility that your holdings could decline swiftly and without warning. Concluding Summary Cryptocurrencies have seen historic growth in recent months, with more rallying forecasted as a crypto-friendly regulatory regime prepares to take up residency in Washington D.C. Three crypto-focused ETFs, hand-selected using SA’s Quant ratings provide investors with exposure to a diverse range of digital assets through direct investments or investments in companies involved in the broader crypto economy. While digital currencies are still a relatively new frontier, and the uncertainty and navigating the complexities can feel intimidating, alternatively, consider exploring Alpha Picks if you’re seeking a limited number of Seeking Alpha Quant’s best monthly ideas from the hundreds of top quant Strong Buy and Buy-rated stocks.

Source: Seeking Alpha