Navigating investments

Founder and CEO of Lake Avenue Financial, a California-based wealth management firm, Alex Chalekian has forged his path, deeply motivated by his family’s struggles with money management. Having experienced the challenges of pursuing the American Dream, he developed a strong desire to educate others on how to build better money habits. In partnership with CoinShares, he explains the different ways that exist to gain Bitcoin exposure.

There are several ways to gain exposure to Bitcoin, each with its own trade-offs. Direct purchase through a cryptocurrency exchange offers full ownership, 24/7 trading, and the potential for maximum appreciation without ongoing management fees. This route, however, demands technical knowledge, secure wallet management, and vigilance against cyber risks.

Exchange-traded products, particularly Bitcoin ETFs, provide an alternative that removes the complexity of custody and private key management. Spot ETFs hold Bitcoin directly, while futures-based ETFs track its price through derivatives. ETFs benefit from regulatory oversight, but investors sacrifice direct ownership, incur management fees, and face potential tracking errors. The choice between these methods depends on the investor’s expertise, risk tolerance, and willingness to manage the security responsibilities of holding Bitcoin directly.

Chalekian outlines the pros and cons of direct purchases vs. exchange-traded products like ETFs.

Key takeaways:

• Direct ownership allows full control, 24/7 trading, and no management fees.

• Risks include technical complexity and security threats (hacks, scams).

• ETFs provide simplicity, regulation, and institutional custody.