The Smartest Crypto ETF to Buy for $50 Right Now

Every day, more and more people start investing in cryptocurrencies like Bitcoin (CRYPTO: BTC). It’s not difficult to understand why. Over the last decade, the S&P 500 increased by around 278% in value. Bitcoin’s value, however, has skyrocketed by more than 17,000% in the same period.

If you want to add huge growth potential to your portfolio by betting on crypto, there is only one ETF that most investors need.

There is a reason why Bitcoin is so famous

When talking about Bitcoin six years ago, legendary investor Peter Thiel summarized the investment proposal for the cryptocurrency: “Money is the bubble that never bursts.” Consider the US dollar. It has value because everyone believes it has value. There are some forms of supporting value, such as military power and taxation power. But in general, currencies like the US dollar – or even stores of value like gold – have value because we all agree that they have value.

When it comes to investing, the rule of thumb is typically to find opportunities that create concrete value in the form of distributable cash flows or real profits. Betting on what other people think the stock will be worth can be a risky gamble. This is why most experts build complex models and analyze financials to determine whether the price they are paying for an investment will be worth the ultimate reward.

Currency – or more colloquially, “money” – is the exception to this rule. Dollar bills no longer produce dollar bills. That’s not where its value comes from. Its value, on a fundamental level, is as a social instrument. We all agree that it represents the value of any work done to achieve it. Bitcoin works in much the same way. It is considered a proof-of-work cryptocurrency, which means that miners are continually working – in this case, solving complex mathematical problems – to produce more Bitcoins. And while it doesn’t have much direct functionality beyond being a form of money, it is the first time a form of money has been created that doesn’t involve large nation-states or other centralized powers.

Of course, many other things are also happening in the crypto space. And it’s possible that encryption in general will enter our daily lives in ways we never expected, just as the Internet continues to do. But regardless of whether these ventures are successful, Bitcoin will always “work.” In other words, it will always maintain its ability to act as a form of money and a store of value.

This is the only crypto ETF you need

Due to these factors, most ordinary investors only need one ETF to gain exposure to cryptocurrencies: the iShares Bitcoin Trust ETF (NASDAQ:IBIT).

As its name suggests, this ETF tracks the price performance of Bitcoin without requiring investors to worry about the complex custody issues related to directly purchasing Bitcoin. The fund currently has an expense ratio of just 0.12% – still lower than most actively traded funds. And since the fund only tracks Bitcoin’s performance, you don’t have to worry about betting on a rapidly changing ecosystem of crypto-related start-ups whose future is anyone’s guess at the moment. Decades from now, Bitcoin will likely still exist, while the long list of crypto ventures started in recent years may be a thing of the past.

The best part about investing in a crypto ETF like this is that it makes dollar-cost averaging easy. If you buy $50 per month of this ETF, for example, be sure to continually invest in all of Bitcoin’s somewhat volatile trading ranges. This way you don’t have to worry about timing the market as you will be buying when prices are high and when prices are low – a wise investment strategy that is a little more difficult when buying Bitcoin directly.

Should you invest $1,000 in Bitcoin right now?

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Ryan Vanzo has positions in Bitcoin. The Motley Fool has positions and recommends Bitcoin. The Motley Fool has a disclosure policy.