Bitcoin is having another banner year. The cryptocurrency surged past USD 126,000 on October 6, its highest level ever, before settling near USD 118,000. Even with volatility, it’s up 25% year to date, driving the total crypto market above USD 4 trillion.
One of the simplest ways for Canadians to gain exposure is through spot bitcoin exchange-traded funds (ETFs) — funds that hold bitcoin directly and track its real-time price.
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Canada’s First-Mover Advantage
Canada was the first country to approve spot bitcoin ETFs in February 2021, starting with the Purpose Bitcoin ETF, followed by CI Galaxy and Fidelity Advantage products. Today, Canadians can choose from nearly three dozen crypto-themed ETFs, including several tracking ethereum.
Crypto ETF assets under management grew from C$5.22 billion in September 2024 to C$5.68 billion in October, an 8.8% increase, reflecting renewed investor interest alongside bitcoin’s rally.
Canadian investors can also access more than 30 U.S.-listed bitcoin ETFs through their brokerage accounts. In the U.S., these ETFs have become the fastest-growing ETF category ever, broadening choices for Canadians seeking crypto exposure.
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BlackRock Shakes Up the Market
In January 2025, BlackRock launched the low-cost iShares Bitcoin ETF (IBIT) in Canada, challenging the country’s high-fee incumbents and signaling growing institutional interest. With friendlier U.S. regulations under President Donald Trump, momentum behind bitcoin ETFs is accelerating.
Tax and Currency Considerations
A key advantage for Canadians is that bitcoin ETFs are eligible for RRSP and TFSA accounts, allowing tax-sheltered or tax-free growth. TFSAs enable tax-free withdrawals, while RRSPs offer tax deductions on contributions and tax-deferred growth (though losses inside RRSPs can’t be claimed).
Investors should also watch currency fluctuations. A weaker Canadian dollar can boost returns on U.S.-denominated ETFs when converted back, while a stronger loonie can reduce gains. Currency-hedged ETF options can help manage this risk.
Spot vs. Traditional Bitcoin ETFs
Unlike futures-based ETFs, spot bitcoin ETFs hold actual bitcoin, closely tracking its market price.
“A bitcoin spot ETF directly holds bitcoin in its portfolio,” explains Michael Zagari of Wellington-Altus Private Wealth. “The value of the ETF moves in line with the current market price.”
This structure gives investors straightforward exposure without the hassle of wallets or private keys.
Strong Regulation, High Volatility
Canada has taken a proactive regulatory approach, with oversight from the Canadian Securities Administrators and FINTRAC to ensure platforms comply with securities laws and safeguard investors.
Still, bitcoin remains volatile.
“The dramatic change in price underscores the difficulty of estimating the fair value of an asset that is primarily a vehicle for speculation,” says Dan Kemp of Morningstar.
For Canadians seeking exposure to crypto within regulated frameworks and tax-advantaged accounts, spot bitcoin ETFs offer a practical way to participate — but investors should remain mindful of the risks.
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