What is ETF?
An ETF, or Exchange-Traded Fund, in crypto trading is a financial product that tracks the price of one or more cryptocurrencies and is traded on traditional stock exchanges, much like stocks. Instead of buying cryptocurrencies like Bitcoin or Ethereum directly, investors can buy shares of a crypto ETF. These shares represent exposure to the underlying assets without the need to manage a digital wallet or deal with the technicalities of crypto exchanges. Crypto ETFs offer a safer and more regulated way for investors, especially institutions, to gain exposure to the volatile crypto market. They also provide better liquidity, ease of trading, and diversification options. Some crypto ETFs are physically backed by cryptocurrencies, while others are futures-based, meaning they track crypto futures contracts rather than holding actual coins. Overall, crypto ETFs aim to bridge the gap between traditional finance and the growing world of digital assets.