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Seeking Alpha 2021-10-25 18:53:30

BITO: Changing My Stance On Bitcoin ETFs, Contango Bleed Will Eat You Alive

Recently, I wrote an article in which I was enthusiastic about Bitcoin ETFs, and more specifically BITO.Since BITO is backed by futures contracts, contango bleed is a huge factor that influences the tracking error of this ETF.Also, BITO suffers from a limit on the number of futures the fund is allowed to hold, which might increase the tracking error.Physically-backed Bitcoin ETFs are the future, not ETFs backed by futures contracts.

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