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Due to the potential for losses, the Financial Conduct Authority (FCA) considers this investment to be high risk.
1. You could lose all the money you invest
2. You should not expect to be protected if something goes wrong
3. You may not be able to sell your investment when you want to
4. Cryptoasset investments can be complex
5. Don't put all your eggs in one basket
If you are interested in learning more about how to protect yourself, visit the FCA's website here.
For further information about cryptoassets, visit the FCA's website here.
A US financial watchdog approved spot Bitcoin ETFs in January 2024 – these are ETFs which hold Bitcoin itself. But the UK financial regulator has blocked this for UK investors so far. Our experts have put together some alternative options for investing in Bitcoin, for the crypto curious.
Here are several alternative ways to invest that you may want to consider:
Keep in mind that stocks related to Bitcoin, and crypto in general, are considered high risk due to the price volatility in the crypto market.
As of January 2024, the Financial Conduct Authority (FCA) continues to ban access to crypto ETFs for UK retail investors. New rules which came into force in October 2023 classed Bitcoin and other cryptocurrencies as “restricted mass market investments”.
The regulator is concerned about the extreme volatility of crypto and the difficulties retail investors face in valuing spot crypto ETFs.
As a result, it has blocked spot crypto ETFs and it seems there are no plans to approve them any time soon in the UK.
Jason Hollands, managing director at DIY investing platform Bestinvest, says: “Even were Bitcoin or cryptocurrency ETFs to become authorised in the UK in the near future, it is possible that these would be primarily accessible for professional investors such as discretionary fund managers or those certified as sophisticated investors.”
Not right now. But if you’re already invested in Bitcoin and holding the digital asset, you would be doubling up if you were to own Bitcoin cryptocurrency and a spot Bitcoin ETF. Typically, people would be looking to do one or the other (unless there were tax advantages).
Part of the reason the spot Bitcoin ETFs were created was to make investing in Bitcoin more accessible to those who are used to more traditional methods of investing in financial assets. If you’re someone who’s savvy enough to buy and hold Bitcoin yourself, you may not even want to use an ETF as an alternative ownership option.
Here’s a list of the 11 spot Bitcoin ETFs that were recently given the green light by the SEC, try and spot the tongue-in-cheek stock ticker symbols:
| Bitcoin ETF | UK approval? |
|---|---|
| ARK 21Shares Bitcoin ETF (ARKB) | |
| Bitwise Bitcoin ETF (BITB) | |
| Blackrock iShares Bitcoin Trust (IBIT) | |
| Franklin Bitcoin ETF (EZBC) | |
| Fidelity Wise Origin Bitcoin Trust (FBTC) | |
| Grayscale Bitcoin Trust (GBTC) | |
| Hashdex Bitcoin ETF (DEFI) | |
| Invesco Galaxy Bitcoin ETF (BTCO) | |
| VanEck Bitcoin Trust (HODL) | |
| Valkyrie Bitcoin Fund (BRRR) | |
| WisdomTree Bitcoin Fund (BTCW) |
If you want to invest in Bitcoin but don’t want to buy it directly, there are several alternatives. But before you jump in, it’s worth asking yourself if hype is affecting your decisions.
*Cryptocurrencies aren't regulated in the UK and there's no protection from the Financial Ombudsman or the Financial Services Compensation Scheme. Your capital is at risk. Capital gains tax on profits may apply.
Cryptocurrencies are speculative and investing in them involves significant risks - they're highly volatile, vulnerable to hacking and sensitive to secondary activity. The value of investments can fall as well as rise and you may get back less than you invested. Past performance is no guarantee of future results. This content shouldn't be interpreted as a recommendation to invest. Before you invest, you should get advice and decide whether the potential return outweighs the risks. Finder, or the author, may have holdings in the cryptocurrencies discussed.
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