Canadian Bitcoin ETFs: How Are They Performing Since Launch?

In 2021, Canada became the first country in the world to approve a spot Bitcoin exchange-traded fund (ETF). While the U.S. wrestled with regulatory hurdles, Canadian issuers like Purpose Investments, 3iQ, and CI Galaxy launched products that gave investors direct exposure to Bitcoin through a familiar, regulated structure.

At the time, these ETFs were hailed as a watershed moment for crypto adoption. They promised to open Bitcoin to mainstream investors, integrate it into retirement accounts, and provide a level of transparency and oversight missing from unregulated markets. Now, several years later, we can ask: how have Canadian Bitcoin ETFs performed, and what lessons do they hold for global markets?

A First-Mover Advantage

When Canada approved the world’s first spot Bitcoin ETF in February 2021, it sent ripples through both the crypto and traditional finance industries. The Purpose Bitcoin ETF (BTCC) became the pioneer, raising over $1 billion in assets under management (AUM) within the first month of trading. That kind of traction would be remarkable for any ETF launch, for a Bitcoin product it was historic.

Other issuers quickly entered the market, including 3iQ CoinShares, CI Galaxy, and Evolve ETFs, each competing on fees, branding, and liquidity. Within months, Canadian investors had multiple options for Bitcoin exposure, creating a competitive environment that accelerated innovation.

This first-mover status offered Canadian investors distinct advantages:

• Tax-advantaged access: Unlike holding Bitcoin directly, investors could put ETF shares inside RRSPs, TFSAs, and other registered accounts, something no other jurisdiction allowed at the time.
• Institutional-grade safeguards: Custody, insurance, and regulatory oversight were built into the structure, reassuring investors who were wary of hacks or mismanagement at unregulated crypto exchanges.
  
  
• Global precedent: The approval proved that regulators could greenlight spot Bitcoin ETFs without destabilizing markets, setting an example that other countries including the US would eventually follow.

In short, Canada’s approval didn’t just benefit local investors. It positioned Canada as a testing ground for one of Bitcoin’s most important institutional adoption milestones.

How Have Canadian Bitcoin ETFs Performed?

Assets Under Management (AUM) Growth

AUM surged during Bitcoin’s 2021 bull run, with Canadian ETFs collectively holding several billion dollars at peal. While AUM fell during the 2022–2023 bear market as Bitcoin’s price declined, many funds retained a strong investor base. This “stickiness” suggested that ETF investors were less speculative and more long-term oriented than trading on exchanges such as Netcoins.

Trading Volumes and Liquidity

From the beginning, Canadian Bitcoin ETFs demonstrated robust daily trading volumes, ensuring that investors could buy and sell shares without major slippage. This liquidity helped normalize Bitcoin exposure among financial advisors and portfolio managers who needed efficient entry and exit points.

Fees and Competition

As more ETFs entered the market, issuers competed aggressively on fees. Purpose initially charged around 1%, but competition pushed fees lower over time. Today, Canadian investors can access spot Bitcoin ETFs with management fees well below 1%, making them close to cost-competitive with U.S. products that launched in 2024.

Advisors and Institutions

Financial advisors also embraced ETFs as an allocation tool, particularly for clients curious about Bitcoin but hesitant to buy it directly. Some institutions used ETFs to add compliant exposure to portfolios, especially before US products were available. While allocations were typically small, ETFs provided a gateway for Bitcoin to enter traditional asset management frameworks.

Comparison to the U.S.

Canada’s early experiment provided valuable lessons for the U.S. and other jurisdictions. By the time US spot ETFs launched in January 2024, regulators and issuers could analyze years of Canadian data showing strong investor demand, manageable risks, and healthy competition. Canada’s experience proved that Bitcoin ETFs could function effectively within traditional markets.

Challenges and Critiques

Despite their successes, Canadian Bitcoin ETFs faced headwinds:

• Volatility: Performance tracked Bitcoin’s price cycles directly, leading to steep drawdowns in bear markets.
• High fees (initially): Early management fees were higher than comparable ETFs for other asset classes.
• Direct vs. ETF exposure: Some argue investors would be better off buying Bitcoin directly to avoid ongoing management costs.
• Competition from U.S. ETFs: Since the launch of U.S. spot Bitcoin ETFs in 2024, global liquidity and media attention have shifted south, making Canadian ETFs less dominant.

The Future of Canadian Bitcoin ETFs

While Canadian ETFs blazed the trail, their future now sits in a more competitive environment. The launch of US spot Bitcoin ETFs in 2024 attracted global attention and massive capital inflows, overshadowing the Canadian market in terms of scale. But Canadian ETFs still play an important role, particularly for local investors.

Key differentiators and opportunities going forward:

• Tax-advantaged positioning: Canadian investors can hold Bitcoin ETFs inside registered accounts (RRSPs, TFSAs, RESPs), a structural advantage that U.S. ETFs cannot replicate directly.
• Product innovation: Issuers may expand into multi-asset crypto ETFs (bundling BTC with ETH or other tokens), covered-call Bitcoin ETFs (to generate yield), or ESG-friendly structures (emphasizing sustainable custody and mining practices).
• Competition with U.S. ETFs: While Canadian funds may not match US scale, they can focus on serving Canadian investors directly and positioning themselves as trusted, regulated domestic options.
  
  

Over the long term, Canadian Bitcoin ETFs will likely remain smaller in scale but strategically important. Their role as pioneers and ongoing access points ensures they’ll continue to be part of the conversation, even as larger global players dominate headlines.

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