Despite tanking in the past few months, Bitcoin's (BTC 0.13%) trailing-10-year return of 17,000% (as of Feb. 12) is still impressive. This makes it one of the best assets investors could've owned. And now that it's on the dip, maybe it's time to buy.
Investing in the spot Bitcoin exchange-traded funds (ETFs) is another popular avenue. BlackRock's iShares Bitcoin Trust (IBIT 0.30%) leads the pack. And it currently has $52 billion in assets under management.
What's the better investment to make for 2026 and beyond?
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Owing the underlying asset requires more effort
There's a certain group of market participants who are Bitcoin maximalists. They might believe that Bitcoin will become a global reserve currency one day. Therefore, they want to own the crypto outright, eliminating counterparty risk in the process and having full self-custody. These individuals can trade 24/7, and they can use the digital asset for payments or other transfers.
CRYPTO: BTC
Key Data Points
If you go this route, it requires more effort. Setting up a dedicated Bitcoin wallet, opening a crypto brokerage exchange, and understanding how private keys work takes time.
Investors who manage their own private keys and custody their own Bitcoin won't be paying any fees to an asset management firm. Moving Bitcoin from an exchange to your own wallet, however, will incur network fees that get paid to miners.
When tax season rolls around, things can get more complicated. When filing the return, all crypto transactions must be reported.
Some investors want hassle-free price exposure
The iShares Bitcoin Trust was launched to provide the market with a regulator-approved investment vehicle to offer access to Bitcoin's price, reducing friction and boosting accessibility and convenience. The ETF trades similarly to a stock and can be traded in a regular brokerage or retirement account. For tax purposes, this also makes things painless.
There are certainly large pools of capital, like pensions, investment managers, and endowments, that have seen Bitcoin's astronomical rise and want to get in on the action in a compliant manner. That's why this ETF has huge appeal. And it helps that BlackRock handles all the administrative work in the background.
It's extremely important to understand that iShares Bitcoin Trust investors don't own Bitcoin directly. Therefore, you can't make full use of the digital asset. And there's a 0.25% annual expense ratio that can chip away at returns. But that's the price you pay for simplicity.
NASDAQ: IBIT
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What is your objective?
The better investment choice comes down to personal preference. Bitcoin's biggest bulls will probably find it worthwhile to understand the best self-custody practices. And they'll be in a solid position should Bitcoin become a widely accepted medium of exchange one day.
If ease of use and only having exposure to Bitcoin's price is the primary goal, then the iShares Bitcoin Trust makes sense.
Either way, investors are taking a bullish stance on Bitcoin.
