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What is an ETF?An ETF ("exchange-traded fund") is a fund whose shares are traded on a stock exchange. Each ETF share is backed by a certain share of the fund's assets. The owner of the ETF invests in the fund's portfolio, but does not own its assets directly. There are large companies that manage these funds and keep records. The largest ETF operators in the world are BlackRock, Vanguard, State Street, Invesco, iShares, and Charles Schwab.
Why do you need a cryptocurrency ETF?A cryptocurrency ETF is an exchange-traded fund whose price is tied to one or more digital assets. A crypto ETF makes it easier for investors in the stock market, both institutional and retail, to buy cryptocurrency. The fact is that not all large investors are ready to directly purchase digital assets due to the inadequate legal framework and difficulties with their storage. For such investors, ETF is a familiar instrument that works stably in the traditional financial infrastructure. Also, the operator of the exchange-traded fund is responsible for storing BTC.
Prospects.As of 2023, the capitalization of the World Stock Market is $109 trillion. And the capitalization of the crypto market is only $2.3 trillion. Of which Bitcoin accounts for about 55%. Investments in BTC and ETH through ETFs can attract traditional financial institutions and large investors from the stock market. Interest in BTC and ETH will grow, as a result, it will further strengthen investor confidence, which will have a positive effect on the crypto market.