Bitcoin ETF vs. Direct Bitcoin: Why High-Net-Worth Investors Choose Ndax OTC

Spot Bitcoin ETFs (Exchange Traded Funds) have been a breakthrough moment for the asset class. Large asset managers like BlackRock helped legitimize Bitcoin and made exposure more accessible through traditional brokerage channels. For many investors, ETFs provide a familiar on-ramp.

But high-net-worth individuals, family offices, and sophisticated wealth managers are asking deeper questions:

• What do we actually own when we buy a Bitcoin ETF?
• Does an ETF provide the same benefits as holding Bitcoin directly?
• What control or utility is lost inside the ETF wrapper?
• Is there a regulated way to own real BTC in Canada? 

Increasingly, the conclusion is clear: if you want true bitcoin exposure, not just price exposure, direct ownership through a regulated Digital Asset Trading Desk offers materially superior benefits.

And if you’re considering a $500k–$1M CAD allocation, how you buy matters as much as what you buy. Ndax Wealth’s Trading Desk is built for size, discretion, and speed.

• Instant settlement in CAD or USD to your Ndax trading account, or delivered in crypto. Trade in either CAD or USD.
• Trades are executed off public order books and are priced and filled 1:1 directly between you and Ndax as the counterparty, minimizing slippage and market impact.
• White-glove onboarding with a dedicated Institutional Sales & Trading Associate who guides your account setup and trade flow end-to-end. 

Ndax Wealth regularly supports six- and seven-figure CAD Bitcoin allocations for Canadian high-net-worth clients, family offices, and corporate treasuries. ETFs may offer convenience, but convenience isn’t the same as ownership or optionality. This blog explains why high net worth (HNW) allocators and institutions increasingly choose Ndax OTC to buy and hold real Bitcoin. 

ETF Investors Own Units, Not Bitcoin

Most spot Bitcoin ETFs, including IBIT, FBTC, BTCC.B, and BTCQ, use a trust-based structure, where investors purchase units representing a beneficial interest in Bitcoin held by the trust. That structure introduces real limits:

• No withdrawal rights: you cannot take possession of the Bitcoin.
• No on-chain functionality: ETF units don’t interact with the Bitcoin network.
• No bearer-asset characteristics: you can’t independently verify or transfer BTC ownership on-chain.
• Operational boundaries: exposure is constrained to brokerage rails and market hours.
• Ongoing MER fees: annual management fees quietly dilute your exposure over time. 

In short, ETFs offer price tracking, not Bitcoin ownership.

Direct Bitcoin via Ndax Trading Desk: Real Ownership of a Real Digital Asset

Buying through Ndax OTC is different in a way that matters to long-term allocators:

• You own actual Bitcoin, not trust units.
• Your BTC is held through a CIRO-supervised Canadian regulated dealer.
• It is secured by institutional-grade custodianship, including Coinbase Custody.
• If your mandate permits, you can withdraw BTC on-chain to a wallet you control. 

Direct BTC isn’t a proxy for Bitcoin. It is Bitcoin.

That distinction is especially important for investors who care about long-duration exposure, strategic optionality, and control. 

Both Ndax and BlackRock’s IBIT uses multiple custodians, including Coinbase Custody, but investor rights diverge sharply.

With Ndax OTC:

• BTC is held for you in custody through Ndax.
• Your holdings sit under Canadian regulatory oversight.
• On-chain withdrawals are available. 
   

With an ETF:

• Custodians hold BTC for the ETF trust, not for you.
• You own trust units — not Bitcoin.
• No withdrawals, ever.
• Exposure remains entirely inside brokerage accounts. 

Same custodian. Different ownership. Different rights. Potentially different outcomes. 

Why ETF Fees Matter

Bitcoin ETFs charge annual Management Expense Ratio (MER) fees that compound over time. Typical rates:

• ~0.25% (U.S.)
• ~0.33% (Canada) 

Bitcoin itself has no holding cost. The ETF wrapper adds one.

MER Drag on a 10 BTC Allocation

Imagine buying $1,000,000 of a Bitcoin ETF when Bitcoin is $100,000. You effectively have exposure to 10 BTC.

Fast-forward 10 years. For illustration purposes only, if Bitcoin rises to $1,000,000, direct holders still have 10 BTC, worth $10,000,000.

But an ETF charges about 0.33% per year in Canada. Over a decade, that compounds into roughly a 3.25% reduction in BTC exposure, meaning your ETF units now represent about 9.675 BTC instead of 10.

At a $1,000,000 Bitcoin price, that’s $9,675,000 vs. $10,000,000. A $325,000 shortfall purely from fees, before even considering other ETF slippage.

MER Is Only One Form of ETF Slippage

ETFs can also underperform spot BTC because of:

• tracking error
• liquidity timing differences
• market-hour mismatches
• trust-structure frictions 

These effects add up over years. With direct ownership, 1 BTC remains 1 BTC, forever. 

Bitcoin trades globally, continuously, without interruption. Markets react instantly to macro events and liquidity is always available.

ETFs trade only during stock-market hours:

• 9:30 a.m.–4:00 p.m. EST, Monday–Friday
• excluding holidays
• subject to halts and circuit breakers
• exposed to weekend price gaps 

If Bitcoin moves meaningfully on a Saturday, ETF holders can’t act. For HNW investors who require agility, hedging, or tactical rebalancing, that constraint is real. 

Owning the bearer asset unlocks capabilities ETFs can’t replicate.

1) Use BTC as Collateral

Because Bitcoin is transparent, verifiable, and transferable 24/7, direct holders can:

• borrow against BTC without selling
• access liquidity tax-efficiently
• structure credit or lending strategies
• settle collateral quickly at any time 

ETF units can’t be used as on-chain collateral.

2) Move Value Globally, Instantly, Permissionlessly

Direct BTC allows:

• transferring large amounts within minutes 24/7/365
• cross-border settlement without banking friction
• weekend or holiday transactions
• efficient treasury mobility for family offices and businesses without relying on fund redemptions or market
• hours 

ETF units have none of these properties. 

Self-custody is the gold standard of Bitcoin ownership — controlling your keys means controlling your wealth.

But most HNW investors and family offices shouldn’t rush into it. Proper self-custody requires governance, multi-party signing, compliance alignment, and contingency planning.

Ndax offers a secure, regulated bridge: you own real BTC today within Canadian oversight, and can withdraw on-chain later when your custody framework is ready. 

Ndax Wealth is built specifically for sophisticated Canadian investors who want more than a self-serve exchange.

Clients receive:

• Dedicated relationship management
• Custom Trade Quote 
• Block trade execution with minimal slippage 
• Custom settlement flows 
• Confidential handling of large orders 

Ndax is both a CIRO-supervised marketplace and a regulated dealer, giving allocators:

• strong Canadian compliance comfort 
• clean CAD/USD funding rails 
• clear domestic reporting 

Bitcoin ETFs helped legitimize Bitcoin and made exposure easy — but they don’t deliver ownership, utility, or continuous liquidity.

For high-net-worth investors allocating $500k–$10M+ CAD, direct Bitcoin ownership through Ndax OTC provides:

• Clear personal benefit: real BTC ownership with full optionality and no MER drag.
• Compliance comfort: CIRO-supervised, Canadian regulated dealer with institutional custody.
• Execution advantage for size: Block pricing off public order books, minimizing slippage.
• A simple next step: discreet, white-glove support with instant settlement. 
   

If you’re planning a Bitcoin allocation above $25,000 CAD, Ndax Wealth provides a high-touch OTC experience designed for larger, sophisticated allocations.

• Instant settlement in CAD or USD to your trading account, or delivered in crypto
• Off-order-book execution with Ndax as your direct counterparty ]
• White-glove onboarding led by your dedicated Institutional Sales & Trading Associate 
   

1. Is buying a Bitcoin ETF the same as owning Bitcoin? 
No. ETFs provide price exposure only. You don’t own BTC, can’t withdraw it, and can’t use it on-chain.

2. If Ndax and BlackRock both use the same custodians, what’s the difference? 
Ndax clients own Bitcoin directly, held on their behalf through Ndax under Canadian regulation, with the ability to withdraw Bitcoin on-chain. By contrast, ETF investors own units of a trust that holds Bitcoin; they do not own or control the underlying Bitcoin and cannot withdraw it on-chain.

3. Can I withdraw my Bitcoin from an ETF? 
No. Bitcoin ETFs do not allow withdrawals under any circumstances.

4. Does direct BTC ownership have a management fee? 
No. Direct Bitcoin ownership does not involve a management or MER fee. Investors only incur transaction-related costs, such as trading fees and/or optional network fees for on-chain transfers. 

5. What if I’m not ready for self-custody? 
Ndax provides secure, regulated custody while you build your long-term self-custody framework. You can withdraw on-chain anytime your mandate permits.