Difference Between Purpose Bitcoin ETF and QBTC (With Table)

For the past 30-40 years, investment has emerged as the main source of income for most people and organizations. It generates the most part of the earnings in the entire world. From the stock exchanges all over the world to multiple mutual funds, this trend has captured the entire world just in a few years. 

In this trend of investment, Bitcoin is the newest of all. It happens to be the currency in a digital format and was created in the year 2009. Alike all other currencies, this currency also works with certain mutual funds dedicated to its exchange. Purpose company’s ETF and 3iq’s QBTC fund are the two types of public bitcoin investment funds that interest the public at large.   

Purpose Bitcoin ETF vs QBTC 

The difference between Purpose Bitcoin ETF and QBTC is that Bitcoin ETF belongs to a Candian investment company, Purpose investment Inc. While the latter belongs to another Canadian company, 3iQ Corp. These two differ from each other in terms of their value and other features as well. In order to know the most appropriate instrument to invest in, it is crucial to be able to differentiate between the two. 

The Purpose Bitcoin ETF has been launched by a public investment company of Canada that is named- Purpose Investment ETF. It happens to be the first-ever exchange fund in respect of bitcoin that exits physically. It assists the investors to make good choices regarding their investment strategy in bitcoin or blockchain. 

While on the other hand, 3iQ Corp is another public investment company present in Canada which offers another fund with the name- QBTC. It not only offers a trading option for bitcoin but for other digital assets too. It offers multiple services such as the call authentication of picture authentication services. It can also be termed as one of the safest such funds available for the customers looking at its reviews.  

Comparison Table Between Purpose Bitcoin ETF and QBTC  

Parameters of Comparison Purpose Bitcoin ETF QBTC 
Meaning  It is an exchange-traded fund for bitcoin by a Canadian company that helps the investors to do the investing prominently.  This is a closed-ended fund for trading and investing in assets having digital nature such as bitcoin, cryptocurrencies, or blockchain products. 
Stands for ETF stands for Exchange Traded Fund. It stands for Bitcoin Trust Fund. 
Operations  Mostly operated in the United States Trades on the Toronto Stock Exchange 
Year of launching  2018 2020  
Parent company  Canadian investment company- Purpose Investment Inc.  Canadian investment company- 3iQ 
Liquidity  This is more liquid in comparison to the QBTC. This fund is less liquid compared to the ETFs. 
Advantages  It offers tax benefits to the investor as it consumes fewer capital gains over a period of time. It lacks in such advantages and offers certain disadvantages as well. 
Annual management fee 1% 1.95% 

 What is Purpose Bitcoin ETF?  

This is basically an Exchange Traded Fund that deals with digital assets such as bitcoin and cryptocurrencies. It was launched by a Canadian public investment company- Purpose Investment Inc. It made its first appearance when it was made trading on the Toronto Stock Exchange. This was the biggest sensation of the year 2018. 

It made a debut in the United States and made its first 80$ Million just in the first hour and surpassed the other Bitcoin Funds available. The company claims it to be the most reliable and safest digital investing strategy tool available out there. It is one of its kind of funds that arose on the eastern side but made such a big impact in North America.  

If looked at the structure this fund works as two terms that are- Purpose Bitcoin ETF, began trading under the symbols TSX: BTCC.B standing for Canadian dollar-denominated ETF non-currency hedged units and TSX: BTCC.U which stands for U.S. dollar-denominated ETF non-currency hedged units. 

 What is QBTC?  

QBTC is a bitcoin public fund provided by a Canadian investment organization, 3iQ Corp. It is basically a tool for those investors who do not wish to possess direct ownership of digital assets. This was made available in the year 2021 in Canada first. 

This fund trades on the Toronto Stock Exchange and happens to be a rather close-ended fund compared with other counterparts. It works like a big pool and provides investors with a definite number of shares. As per the company, this is a tool made to make people more acquainted with such digital assets and empower them in terms of investing.  

In this fund, there exists an asset manager who takes care of the allocation of shares. It has the capability of participating in an IPO to raise more money for the venture. For now, this fund has shares that have a value of 0.00112387 BTC. However, it has certain shortcomings such as limited availability outside Canada and an annual management fee of 1.95%.  

Main Differences Between Purpose Bitcoin ETF and QBTC  

  1. Purpose Bitcoin ETF is an Exchange traded fund that works on the pattern of other ETFs while on the other side, the QBTC is a digital mutual fund that works on the pattern of other such funds. 
  2. Purpose Bitcoin ETF is an exchange traded fund for bitcoin by a Canadian company which helps the investors to do the investing prominently. While QBTC is a closed ended fund for trading and investing in assets having digital nature such as- bitcoin, cryptocurrencies or blockchain products. 
  3. Purpose Bitcoin ETF was launched in the year 2018 while the QBTC was launched in the year 2021/ 
  4. Purpose Bitcoin ETF is a digital product offered by the Purpose Investment Inc. But the QBTC is a product offered by the 3iQ Corp, Canada. 
  5. Purpose Bitcoin ETF offers tax and liquidity benefits at a major extent in comparison to the 3iQ’s QBTC. 

Conclusion  

When it comes to investment, a number of funds, indexes, and exchanges are present all over the world. It just takes one suitable such tool for the investor to get started in his investment journey and make the most of his money. And even if someone is not looking to invest in such assets, digital currencies have become the headlines of every news channel. For one to be aware of his surroundings, it is important to have known about these tools.  

Purpose Bitcoin ETF and the QBTC are two of the most popular and in-demand funds for trading digital assets. It is crucial to know that how they differ from each other and what are the pros and cons attached to these two. This article has shredded enough light upon this topic.  

References  

  1. https://www.sciencedirect.com/science/article/pii/B9780128021170000278
  2. https://ieeexplore.ieee.org/abstract/document/8740574
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