Crypto index funds and ETFs offer an avenue for passive income by providing diversified exposure to digital assets without the need for active portfolio management. These investment vehicles are categorized into centralized and decentralized options, with income generated from asset appreciation, staking, DeFi yields, and covered call strategies. However, investors must be mindful of risks such as market volatility and smart contract vulnerabilities. Popular crypto index funds currently include Bitwise 10 and TokenSets, while ETFs like ProShares Bitcoin Strategy ETF and Purpose Bitcoin Yield ETF have gained traction for their unique strategies aimed at generating regular income. The appeal of such funds lies in their ability to automate investing, allowing for reduced risk and diversified assets. Investors can access these products via centralized stockbrokers or decentralized Web3 wallets, making them accessible to a wider audience. While passive income through these methods can be rewarding, thorough research is advised to understand the associated risks and potential tax implications of investing in these funds.

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