How to Invest in Cryptocurrency Without Actually Investing in It

Although cryptocurrency can be a rewarding investment, there is a substantial risk involved, particularly when making your initial investment. Consider that even seasoned investors exercise some caution while handling cryptocurrencies. However, there are still a number of indirect investment options available for people who are interested in cryptocurrencies but do not want to buy or keep any of them.

Continue reading to learn how to choose the best course of action, reduce your risks, and make a significant profit.

What is on the Agenda?

With the rise in popularity of cryptocurrencies like Dogecoin, Ethereum, and Bitcoin in recent years, some investors are jumping into the market in the hopes of making big money.

Even with ongoing market research and forecasts, there is still a significant risk of failure. Things are changing so quickly right now that it is difficult to predict the future. It’s equally likely that bitcoin will eventually lose all of its value because to the COVID-19 pandemic’s strain. However, with cryptocurrencies becoming more and more popular, it’s difficult to resist their allure these days.

Let’s look at the three primary strategies that investors might use to purchase cryptocurrencies without really holding any of them.

Invest in Cryptocurrency-Holding Companies

Most people who choose to purchase cryptocurrencies do so with the intention of obtaining the funds directly, such as Bitcoin tokens. It is actually preferable to invest in cryptocurrency stocks rather than buying tokens directly.

An entity that has some connection to the cryptocurrency movement is referred to as a crypto stock. For example, investing in businesses that list Bitcoin on their balance sheets or provide services pertaining to digital currencies gives an investor indirect access to the cryptocurrency. There are several publicly traded companies that fit this criteria that people can choose from. Two well-known titans that have made significant investments in this area are MicroStrategy and Tesla.


Tesla first consented to take Bitcoin as payment for its goods after investing $1.5 billion in the cryptocurrency. But the business recently abandoned the notion of taking Bitcoin and even sold most of its available supplies. Elon Musk later hinted that Tesla might have liquidated all of its Bitcoin assets. He gave an explanation for his decision to stop supporting Bitcoin, citing the unfriendly nature of bitcoin mining. Since Musk has praised Dogecoin and frequently expresses gratitude for it on Twitter, many assume that Dogecoin will eventually become his preferred form of payment.


MicroStrategy, a Virginia-based business analytics firm, is well-known for its substantial Bitcoin investment. MicroStrategy made a $250 million investment in Bitcoin in August 2020, citing a decline in cash yields, a depreciating value of the US dollar, and other important economic considerations. The business has spent almost $2 billion in Bitcoin (at $24,311 per unit), and as a result, the price fluctuations of Bitcoin have a significant impact on the value of the company’s shares.


The first American business to run a cryptocurrency trading platform that is listed on the US Nasdaq exchange is Coinbase. The business reported a rise in April, going from $190.6 million to $1.8 billion. The spike was caused by the increase in Bitcoin’s price during that period.

By the way, the company’s estimated value is $47 billion based on the reference price of $250.00 per share given by Nasdaq. Coinbase closed trading on its first day of operation at $328.28 per share.

Coinbase started handling Dogecoin in early June 2021, making it accessible to Coinbase Pro users.


In October 2020, the digital payments corporation invested roughly 1% of their entire assets ($50 million) in Bitcoin, which is currently valued at over $220 million. Square now owns nearly $500 million worth of cryptocurrencies after the corporation purchased an additional $170 million worth in February 2021. Additionally, Square enables a variety of cryptocurrency to be accepted as payment by its sellers.

While not being the only focus of any of these businesses, Bitcoin plays a big role in their operations. These businesses stand to gain greatly if cryptocurrency takes off and is eventually adopted as a form of payment on a large scale. You can profit from the rise of cryptocurrencies without taking on the risks associated with coin purchases by investing in these kinds of equities.

What Else to Expect from Crypto Stocks?

Before making this kind of investment, there are a few things you should think about even if it might be a great strategy to reduce your risks.

First and foremost, you should never purchase a stock merely because it has a bitcoin connection. Stocks in companies with low potential that do not see sustained success in cryptocurrency will have a difficult time making a full recovery. However, robust businesses have a better chance of surviving the crisis regardless of changes in the cryptocurrency market.

When thinking about stocks, make sure you conduct extensive research. Is the business doing well financially? Is it led by a competent group of experts? Does it have a benefit over competitors in its industry? Having a broad view will be simpler with all of these elements. Any business must be able to see its long-term potential. There is no discernible difference between a business that fails and one that is connected to cryptocurrencies or not.

Remember the proverb, “Don’t put all your eggs in one basket,” which suggests that if you plan to invest in cryptocurrency stocks, you should diversify your holdings rather than concentrating on just one. If your cryptocurrency investments don’t pan out, diversifying your portfolio can help you further reduce your risk.

Although it might be risky, cryptocurrency is undoubtedly one of the most popular trends in the investing industry. There are various possibilities available even in the crypto industry. Investing in Bitcoin, Ethereum, Dogecoin, or all of them together can lower an investor’s risk in the event of unforeseen losses.

Invest In Companies That Deal With Cryptocurrency-Related Sectors

Investing in blockchain technology firms is another way for an investor to profit from cryptocurrencies.

With 200 million members, PayPal is arguably the most well-known business that allows investors to gain tangential exposure to Bitcoin. Additionally, Galaxy Digital and Riot Blockchain are innovators in the digital asset, cryptocurrency, and blockchain technology industries for diverse financial services and investment management.

Furthermore, industry heavyweights like Google, IBM, Amazon, SAP, and Microsoft are all experimenting with or fully committed to using blockchain technology across many facets of their operations.

Investing in businesses that create the specialized hardware used by cryptocurrency miners, like those who make GPUs (graphic processing units) that are placed in computers for blockchain technology, is an additional strategy.


This business manufactures GPUs for computers, which are extensively used in bitcoin mining. They can produce lucrative digital currency, but they cannot power a computer monitor. As the value of cryptocurrencies increased in February, Nvidia unveiled new chips designed just for cryptocurrency mining.

By the way, miners can obtain optimal performance using Nvidia’s pro-level cryptocurrency mining GPU.

Invest In Cryptocurrency-Linked Investment Funds

Grayscale Bitcoin Trust

Through a conventional investment vehicle, investors can obtain indirect exposure to the fluctuations in the price of Bitcoin by means of the Grayscale Bitcoin Trust, a fund established by Grayscale Investments. Additionally, investors can purchase bitcoins through the trust without requiring digital wallets. If investors bought the fund directly, they wouldn’t have to pay the 2% management fee.

The increasing popularity of cryptocurrencies has led exchange-traded fund (ETF) providers to encourage the formation of funds that monitor Bitcoin’s performance. ETFs are thought to make trading easier and less complicated when it comes to combining and storing portfolios. Several US companies have submitted applications to construct Bitcoin ETFs, in response to the Canadian government’s decision to create bitcoin ETFs. As soon as the US government gives its approval, Grayscale Investments plans to convert its trust into an exchange-traded fund.

Osprey Funds

The strategy of Osprey Funds is centered on providing simple, inexpensive, and safe access to digital assets. Additionally, it offers a simple and safe way to include Bitcoin into an investment portfolio. With a management charge of 0.49%, the trust has the lowest of all US publicly listed Bitcoin funds.

The trust may be kept in other tax-advantaged funds or individual retirement accounts. You may also use Bitcoin without worrying about wallets, keys, or storage thanks to the Osprey Bitcoin Trust.

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