Spot Exchange Traded Fund

Definition ∞ A Spot Exchange Traded Fund is an investment product that holds the actual underlying asset, such as Bitcoin, rather than derivatives or futures contracts. These funds trade on traditional stock exchanges, offering investors exposure to the asset’s real-time price movements without direct ownership. Spot ETFs provide a regulated and accessible vehicle for institutional and retail investors. They simplify investment in commodities or digital assets.
Context ∞ The approval and launch of spot Exchange Traded Funds for cryptocurrencies, particularly Bitcoin, have been a dominant news story in financial and digital asset markets. Discussions center on their impact on market liquidity, institutional adoption, and regulatory precedents. Spot ETFs are considered a significant step towards mainstream acceptance, providing a regulated bridge between traditional investment portfolios and digital assets.