Bitcoin back above $100,000: Financial planning icon Ric Edelman reacts to the crypto ETF boom

Bitcoin had a significant week with the launch of new crypto exchange-traded funds. Ric Edelman, an investor and renowned personal finance author, believes these new offerings provide investors with more opportunities for gains. He expressed particular excitement about buffer ETFs and yield ETFs, stating that they allow investors to benefit from bitcoin’s upside potential while protecting against downside risks.

Edelman, also the founder of the Digital Assets Council of Financial Professionals and a member of Barron’s Financial Advisor Hall of Fame, emphasized the importance of viewing cryptocurrencies as a long-term investment to diversify a portfolio, similar to the stock market. He cautioned against leveraging and inverse bitcoin ETFs, highlighting that many retail investors may not fully grasp the risks involved.

As bitcoin’s value surged past $100,000 this week, Edelman’s remarks coincided with the cryptocurrency’s rally, which saw a 6% increase in value by the close of trading on Friday. However, he cautioned against high-risk ETFs with daily resets, likening them to buying a lottery ticket rather than making sound investments.

In a related discussion on the “ETF Edge” show, host Bob Pisani mentioned the 2x Bitcoin Strategy ETF (BITX) as an example of a leveraged bitcoin product with daily fees and resets. Despite outperforming bitcoin this week and showing a 19% increase for the month, BITX has lagged behind bitcoin’s overall performance this year. The provider of BITX, Volatility Shares, warns on its website that the fund is not suitable for all investors and carries a high risk of losing the entire investment within a single day.