Analysis-Bitcoin futures highlight some pitfalls for new ETFs

FILE PHOTO: A representation of the virtual cryptocurrency Bitcoin is seen in this picture illustration taken October 19, 2021. REUTERS/Edgar Su

NEW YORK (Reuters) - The launch of the first bitcoin futures exchange traded fund (ETF) on Tuesday marks a major step toward legitimizing the cryptocurrency, but some ETF investors may face higher costs compared with buying the digital currency itself.

Barring any last-minute objection from the U.S. Securities and Exchange Commission, the ProShares Bitcoin Strategy ETF will begin trading on Tuesday. ProShares will be backed by the CME Group's bitcoin futures instead of the actual virtual asset itself.