How to Trade ProShares Bitcoin BITO ETF on Fidelity

Someone asks:

Anyone know if Fidelity is going to make BITO (Bitcoin ETF) available to us for investing? If so, when? Thank you!


Robert A:

It goes live Tuesday. Keep in mind it is crypto futures; long contracts versus short contracts are typically “contango” which means the long contracts price higher reflecting the negative carry on the commodity.

A futures ETF will perpetually be rolling near by contracts for longer term contracts, unless the futures curve is in backwardation (as you might infer, that’s not the normal case) they will be losing money with each futures roll. Of course the fund could still make money if the entire curve is shifting toward higher prices, but this is substantially different product than a long crypto ETF. I think it would have been better if that had gotten the exposure through total return swaps.

Jason P:

Since it doesn’t hold cryptocurrency, it will likely be available when the ETF goes live (or shortly thereafter). Much like GBTC is available on Fidelity.

Mike P:

Also is RIGZ, it’s for Bitcoin mining companies. I like the return so far, but I actually invest in crypto. I think that is better than BITO ETF. BITO is BTC futures while BLOK is blockchain related companies.

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