3 Things Investors Need to Know About the Bitwise Crypto Industry Innovators ETF in 2026

Broadly speaking, issuers of exchange-traded funds (ETFs) are willing to try new things and address perceived demand for products that extend beyond the plain-vanilla, pure-beta realm.

Think about the explosion of ETFs addressing thematic investing. There's demand for these funds, as evidenced by their combined $779 billion in assets under management (AUM) globally as of the end of the third quarter of 2025. One of the success stories among thematic ETFs is the Bitwise Crypto Industry Innovators ETF (NYSEMKT: BITQ).

This ETF is crypto-correlated, but it doesn't directly own digital currencies. Image source: Getty Images.

This ETF has nearly $431 million in AUM and turns five years old in May, confirming it attracted investor interest and has staying power. The Bitwise fund could also generate impressive returns this year and beyond, but prospective investors need to know the following three things before getting involved.

This isn't a spot Bitcoin ETF

The largest cryptocurrency ETFs on the market today are spot funds designed to track the prices of Bitcoin and Ethereum, among other digital currencies. That's not what this Bitwise ETF does.

Instead, it's an index fund that tracks the Bitwise Crypto Innovators 30 Index, a collection of stocks. Investors buying this ETF are purchasing a basket of crypto-correlated equities, not direct ownership of Bitcoin or similar assets.

Indeed, the ETF's correlations to Bitcoin and Ethereum stood at 0.7 and 0.63, respectively, at the end of last year, confirming it provides investors with ample leverage to the upside (and downside) fortunes of the largest digital currencies.

It's sort of a "next-gen" financial services ETF

One interesting aspect of the Bitwise ETF is that it makes investing in the financial services sector more engaging. Think about it this way: An investor buying an old-guard ETF in that sector is getting a fund that is heavily allocated to investment and money-center banks as well as insurance providers. What they aren't getting is robust crypto exposure.

With a 41.1% allocation to custody and trading names, this ETF livens up financial services investing. For example, its largest holding from that sector is Coinbase Global, which accounts for 8.39% of the fund's portfolio. Other, more youthful financial companies residing in this ETF include Bullish and Robinhood Markets.

The point is this isn't your grandfather's financial services ETF, and for risk-tolerant investors, that's all right.

Some of its holdings are evolving

Bitcoin miners were among the first publicly traded crypto-adjacent stocks. That age, coupled with subsequent market capitalization gains for some, is among the reasons this ETF devotes nearly 37% of its roster to miners. Alone, that percentage makes miners' footprint in the fund a factor investors must consider, but there's more to the story.

Some of the Bitcoin miners held by the Bitwise ETF are reducing or eliminating their reliance on mining in favor of leveraging their established infrastructure and technology stacks in the artificial intelligence (AI) space.

Two prime examples of that trend are Iren Limited, this ETF's fourth-largest component, and Terawulf. Iren is rapidly emerging as a force to be reckoned with in AI infrastructure, and the same can be said of Terawulf in data centers. Bottom line: Some of this ETF's "leopards" are changing their spots, potentially positioning the fund as an AI beneficiary.

Todd Shriber has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin and Ethereum. The Motley Fool recommends Coinbase Global. The Motley Fool has a disclosure policy.