Income-Based ETFs Standing Tall Amid Crypto Struggles

With 2026 nearly half over, it’s fair to say that plenty of cryptocurrency investors are frustrated, and that sentiment isn’t confined to highly speculative meme coins. It’s relevant to investors engaged with the “big boys” such as bitcoin and ether.

On a more encouraging note, crypto-based ETFs, including those dedicated to bitcoin and ether, remain parts of many portfolios, confirming that advisors and investors see long-term utility in having some exposure to the leading digital assets.

There’s another point that bears watching. As VettaFi Director of Research Todd Rosenbluth pointed out in an CNBC interview, the cryptocurrency ETF space is maturing, giving rise to income-driven products such as the NEOS Ethereum High Income ETF (NEHI) and the NEOS Bitcoin High Income ETF (BTCI).

“BTCI…has exposure to bitcoin, but uses options to generate additional income. That’s actually been the most popular of the bitcoin-related ETFs,” said Rosenbluth in the interview. “Roughly $500 million went into that ETF this year, as of last week. So that’s encouraging.”



BTCI is proof positive of investors’ enthusiasm for the marriage of crypto and income. The ETF, which sports a distribution rate of 26.72%, turns two years old in October and already has $1.15 billion in assets under management.

Different Crypto Approaches Validated

As advisors know, the January 2024 debut of spot bitcoin ETFs was a seminal time in the ETF industry. But, as BTCI and NEHI prove, tastes are evolving and income is on the radar. Like its stablemate BTCI, NEHI obliges. The options-based ether play carries a distribution rate of 32.99%.

The point is that, as Rosenbluth noted, the cryptocurrency ETF market is evolving, and investors aren’t being shy about going along for the ride. In fact, their shifting tastes are contributing factors in the maturation of the digital currency ETF marketplace.

“So that’s encouraging to me, that people are getting exposure in different forms, whether it’s traditional spot bitcoin or an options-based product,” said Rosenbluth in the CNBC interview.

BTCI and NEHI write call options on well-known, highly liquid spot ETFs holding bitcoin and ether. There is potential for some upside participation with the two largest cryptocurrencies. As Rosenbluth points out, the weakness permeating the digital currency realm this year has sent some investors to the sidelines, but it may also be creating a buying opportunity.

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