eTrade does not allow you to invest in cryptocurrencies directly. Unlike other brokerage accounts and crypto exchanges, you cannot buy and hold digital currencies in a wallet. However, you can get indirect exposure to cryptocurrency coins by investing in eTrade’s crypto-related securities. In this guide, I will walk you through the options you have to gain exposure to digital assets such as Bitcoin and Ethereum and I will show you some alternative platforms you could use to buy crypto directly.
What cryptos can I get exposure to on eTrade?
ETrade offers the following securities
Grayscale Bitcoin Trust (GBTC)
Grayscale Bitcoin Trust (GBTC) is an investment product offered by Grayscale Investments, allowing investors to gain exposure to Bitcoin’s price movements without directly owning or managing the cryptocurrency. GBTC is structured as a trust, with each share representing a certain amount of Bitcoin held by the trust and traded on over-the-counter markets.
Grayscale Ethereum Trust (ETHE)
The Grayscale Ethereum Trust offers exposure to the Ethereum blockchain’s ETH token. Ethereum is the second largest blockchain in terms of market cap after Bitcoin. Its main innovation was that it allowed developers to build apps on top of it. You have stuff lending and borrowing apps, exchange apps, yield aggregator apps, and much more.
Other popular crypto trusts you can invest in on eTrade are:
- Osprey Bitcoin Trust (OBTC)
- Grayscale Ethereum Classic Trust (ETCG)
- Grayscale Litecoin Trust (LTCN) for exposure to Litecoin
- Grayscale Bitcoin Cash Trust (BCHG) for Bitcoin Cash
- VanEck ETF Trust VanEck Bitcoin (XBTF)
- Grayscale Zcash Trust (ZCSH) which offers exposure to ZCASH
- Grayscale Horizen Trust (HZEN) offers you exposure to a cryptocurrency called ZEN.
2. Publicly traded crypto mining companies
Riot Blockchain, Inc. is a publicly-traded company that focuses on mining Bitcoin. It is one of the largest mining companies worldwide. Bitcoin mining companies use powerful data processing machines called ASICs to solve computationally challenging cryptographic problems. When they succeed they are rewarded in newly minted Bitcoin and fees. There are economies of scale to mining Bitcoin and usually, these companies are so large that they can negotiate power grid contracts.
Another mining company whose stock you can invest in on eTrade is Marathon Digital Holdings, Inc. (MARA)
3. Publicly traded companies that invest in crypto
MSTR is a publicly traded data analytics company that became famous after it started investing a large proportion of its treasury in Bitcoin. According to Coingecko MSTR holds 174530 bitcoin valued at more than $7Bn at the time of writing while MSTR’s market cap is valued at $7.9Bn. Many see holding MSTR as equivalent to holding
4. Companies that sell crypto
PayPal is a widely used online payment platform that facilitates transactions, allowing users to send and receive money, make online purchases, and manage their finances securely.
In 2021 PayPal started allowing its users to buy and sell crypto.
Coinbase is one of the largest crypto exchanges and the only one that is publicly traded.
Block, Inc. (SQ)
Formerly known as Square is the company founded by Jack Dorsey the founder of Twitter and a well-known Bitcoin fan. One of Block’s apps, Cash-app accepts and facilitates crypto payments.
Silvergate Capital Corporation (SI)
This is the now infamous bank that recently collapsed. Silvergate was the main banking platform for digital asset companies in the United States
There are a bunch of exchange-traded funds that invest in crypto-related assets usually companies involved in digital assets or in futures or a combination of the two.
Crypto Futures products
- ProShares Trust – ProShares Bitcoin Strategy ETF (BITO) offers exposure to Bitcoin-type returns by investing in Bitcoin futures trading rather than Bitcoin itself
- Valkyrie ETF Trust II – Valkyrie Bitcoin Strategy ETF (BTF) primarily invests in bitcoin and ether futures contracts.
- Siren Nasdaq NexGen Economy ETF (BLCN) invests in developing, researching, or utilizing blockchain technologies.
- Amplify Transformational Data Sharing ETF (BLOK) which invests in blockchain companies
- Exchange Traded Concepts (BITQ) is a traditional ETF in which companies generate the majority of their revenue from their crypto business activities.
- Global X Blockchain & Bitcoin Strategy ETF (BITS) invests in companies in digital asset mining, blockchain & digital asset transactions, blockchain applications, blockchain & digital asset hardware and integration.
- VanEck Vectors ETF Trust (DAPP) tracks MVIS Global Digital Assets Equity Index (the “Index”), which in turn tracks the performance of companies that are participating in the digital assets economies.
- Invesco Exchange-Traded Fund Trust II -(CRPT) invests 80% of assets in stocks of Digital Economy Companies.
- Invesco Galaxy Crypto Economy ETF (SATO) is based on the Alerian Galaxy Global Cryptocurrency-Focused Blockchain Equity, Trusts, and ETPs Index (Index). The Fund invests 80% in stocks of digital asset companies, ie companies that are materially engaged in cryptocurrency mining, buying, etc
- Simplify U.S. Equity PLUS GBTC ETF (SPBC). This ETF is mostly focused on US securities with 10% exposure to the bitcoin grayscale fund.
- Bitwise 10 Crypto Index Fund (BITW) is an index fund that seeks to track the behavior of the top 10 cryptocurrencies weighted by market cap and rebalanced monthly.
Alternatives to eTrade for investing in crypto
To invest in crypto you have two main options. Either you use an online brokerage similar to eTrade that allows you to buy crypto OR you use a crypto exchange.
The benefit of using an online broker is that you can manage all your financial products in one place: crypto, ETFs, stocks, mutual funds, etc. The drawback is that they offer a limited selection of cryptocurrencies compared to exchanges and it is harder to move your virtual currencies elsewhere.
Popular brokerages that offer crypto are
- eToro a popular online trading platform for both crypto and traditional assets
- Robinhood offers easier access to Gen Z and millennials and is the only broker that offers its users a wallet. On Robinhood, you can find popular coins such as BTC, ETH, Dogecoin, and more.
- Webull, one of the best brokers, offers 4 cryptos: Bitcoin, Bitcoin Cash, Litecoin, and Ethereum.
- Interactive Brokers, one of the largest trading platforms which now allows their users to invest in 4 cryptos including Bitcoin and Ethereum.
Similarly to Etrade traditional brokers such as Charles Schwab and TD Ameritrade only offer indirect exposure.
The benefit of cryptocurrency trading platforms is that you have a wider selection of cryptocurrency investments to choose from and direct access to coins and tokens.
Also, once you purchase your crypto assets you can move them onto a crypto wallet where only you have access to the private keys of that wallet. This means that if an exchange were to go bankrupt you would avoid losing your investment. Exchanges that are popular with active traders are
to name a few of the most popular ones on the crypto market today.
ETRADE is an online financial services platform that provides brokerage, investment, and banking services, allowing users to trade stocks, bonds, options and other related products, and manage various investment accounts. The e-trade platform became a part of Morgan Stanley in 2020 and offers a range of tools and resources for both individual and institutional investors.
Setting up an e-trade account is easy. All you need to do is provide and verify your personal information. The platform accepts debit cards and credit cards as well as ACH transfers. Users can access their account via the desktop of e-Trade’s mobile app.
In the rapidly changing world of trading and crypto, the ecosystem keeps changing. It is hard to keep up with how innovative platforms such as Webull are updating their product offering. In this article, I break down what Webull offers in terms of crypto trading and whether it is worth it. Read more.