Cryptocurrency has revolutionized the way we look at finances, whether we like it or not. The legendary investor Warren Buffett spent his entire life building a multi-billion-dollar empire, and we have teenagers turning $1,000 to millions every day. Well, the Purpose Ether Yield ETF (ticker symbol: ETHY.TO) is not going to make you a millionaire overnight. But it certainly provides some very attractive yields in the industry right now.

We fear the unknown and cryptocurrency is very much in the regions of the unknown for the majority of people. This is where exchange-traded funds (ETF) such as Ether Yield ETF come in handy. It wraps up some of the high rewards of the crypto world with the familiar investor cushions such as ETF, share prices, and dividends.

Yes, dividends. Purpose Ether Yield ETF gained viral popularity for its high yield in the last few months. At the time of this article, the annual dividend yield of the ETF stood at 19.47%. These are groundbreaking yields, hinting us at the underlying tentacles of the cryptocurrency it relies on.

What is Purpose Investments?

Purpose Investments have introduced five cryptocurrency-based ETFs to the world: Purpose Bitcoin ETF, Purpose Ether ETF, Purpose Bitcoin Yield ETF, Purpose Ether Yield ETF, and Purpose Crypto Opportunities ETF. The first two ETFs focus on tracking the price of their underlying cryptocurrencies Bitcoin and Ethereum. The next two yield ETFs focus on generating profits from selling covered calls on the underlying cryptocurrencies. The last ETF combines both Bitcoin and Ethereum holdings to diversify some risk. Bitcoin and Ethereum are the two biggest cryptocurrencies in the world with a combined market cap of $1.2 trillion. This represents 65% of the total cryptocurrency market.

What is Purpose Ether Yield ETF?

The Ether Yield ETF focuses on generating high yields for its investors. It does so by selling covered call options on Ethereum price fluctuations. This is a quite complicated investment strategy best left to the professionals. We, average investors, only need to worry about a few metrics the ETF shows us. However, if you wish to learn more about covered call strategies on cryptocurrency assets, this is an excellent article by Purpose Investments.

Quick Facts	ETHY.TO
Fund inception date	Nov 30, 2021
Net Assets (Feb 11, 2022)	$37 million
Exchange	Toronto Stock Exchange
Annualized distributions yield	19.47%
Distribution frequency	Monthly
Management expense ratio	1.1%
Account eligibility	TSFA/RRSP

ETHY ETF has a rather high management expense ratio, which is more than compensated for by its very high distribution yield.

One of the main benefits of holding the ETHY ETF over buying cryptocurrency is that the ETF bypasses all the complexities one has to go through just to buy cryptocurrency. An investor has to create a cryptocurrency wallet, secure it with a passcode, know a bit about blockchain, learn a bit of crypto jargon, register themselves on a crypto exchange such as Binance, verify themselves on the exchange to start trading, add bank accounts/credit cards, and still navigate to buying the right cryptocurrency. But when it comes to purchasing ETHY ETF, it is simple as buying any other stock or ETF.

Since cryptocurrency is generally regarded as a high-risk investment, the Ether Yield ETF cannot escape from being labeled the same. Should Ethereum fail for some reason, this ETF will cease to exist as well. However, the price fluctuations of Ethereum will not likely impact the yields of this ETF.

The Purpose Ether Yield (US Currency) ETF (ticker symbol: ETHY.U) brags for even higher yields at 24.62% at the time of this article.

ETHY ETF’s monthly dividend payments, high yields, and low marker price makes it a perfect candidate for dividend reinvesting, too. The fund itself allows investors to DRIP through qualifying brokerages.

Are the High Yields on ETHY ETF Sustainable?

Whilst nobody can give a guarantee on any sort of investment and its security, we can make assumptions based on different estimates we have. Covered call options realize profits on market volatilities. The higher the volatility, the higher the chance of profits and also the higher the size of profits. This is what enables ETFs such as ETHY to deliver such massive returns. One thing certain about cryptocurrencies is that they tend to show the highest levels of volatility any asset class has ever seen.

Check out the latest information about ETHY ETF on the official website.

What do you think about these brand-new ETFs backed by cryptocurrency ecosystems? Do you think these returns are sustainable? Let us know in the comments below.