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Digital coins may well change how people buy and sell goods one day, but for the moment they’re mostly an investment, and a remarkably tough one to use and secure.

That’s why so many fund companies want to start exchange-traded funds that will track the price of digital coins and trade like any other ETF in a brokerage account. The Securities and Exchange Commission has so far squashed these hopes, citing the volatility of cryptocurrencies, among other reasons.

Now there are two publicly traded U.S. securities made up entirely of cryptocurrencies that are available to investors in their brokerage accounts.

These are enticing investments that have made tens of millions of dollars for investors who got in early, but buyer beware: The publicly traded securities trade at huge premiums to their underlying net asset value. Changes in regulations, or the available amount of the security itself, could cause wide fluctuations in their prices above and beyond the volatility of the digital coins.

The Ethereum Classic Investment Trust (ticker: ETCG), a security created by digital-currency specialist Grayscale Investments, became available on over-the-counter markets in May. Each share of the trust represents a stake in the digital coin ethereum classic. Grayscale also developed the Bitcoin Investment Trust (GBTC), a security that tracks the price of bitcoin and has traded publicly since 2015. The Bitcoin trust has generated strong interest from hedge funds, mutual funds, and retail investors; the Ethereum Classic trust started trading too recently for funds to have to disclose their positions. The Bitcoin trust held $1.7 billion in assets, and the Ethereum Classic trust held $81.5 million as of April 30.

“We’re taking something that has a lot of frictions behind buying, holding, storing, and safekeeping, and making it familiar and transparent,” says Michael Sonnenshein, managing director at Grayscale. Sonnenshein likens the trusts to the SPDR Gold Shares ETF (GLD), an investment vehicle that allows people to own an asset that is otherwise difficult to hold.

Ethereum classic is a more obscure and lightly traded cryptocurrency than bitcoin. It was created because of an ideological split over Ethereum, the second most prominent digital-coin network after bitcoin. In 2016, a hack of the Ethereum blockchain led to a divide among developers working on it—some wanted to change the software to reverse the hack, while others believed that the blockchain should be left intact. The first group went ahead with the software update, restoring the stolen coins to their original owners, while the second group continued to use the original software, leading to a “fork.” The network run by the first group is now known simply as Ethereum, while the second group’s network is Ethereum Classic.

These kinds of forks aren’t uncommon in the crypto world—bitcoin has spawned bitcoin gold and bitcoin cash, for instance. But they can lead to winners and losers. And ethereum classic is arguably less successful, as it’s trading at just 2.7% of ethereum’s market value and is ranked as the 18th most valuable cryptocurrency by coinmarketcap.com. Software developers, including some who work for large corporations, have increasingly used Ethereum as the base code for their own blockchain applications.

Ethereum classic could still play an important role in future blockchain development, some proponents say. And there are other possible advantages: Developers have agreed to cap the total supply of ethereum classic, unlike ethereum.

“At the end of the day, they may have a more sound monetary policy” than Ethereum, says Murray Stahl, who runs money manager Horizon Kinetics, which has invested in ethereum classic and the Ethereum Classic trust.

Most people couldn’t care less about these philosophical battles. But millions are clearly interested in buying into the crypto phenomenon: Digital-coin exchange Coinbase recently passed 20 million users.

Still, it isn’t easy for many investors to hold digital coins. Setting up digital wallets and protected hard drives can be onerous. Crypto exchanges have historically been vulnerable to website breakdowns and hacks, and are often off limits to institutions. Large U.S. exchanges now offer bitcoin futures, but investors need to put up substantial upfront margin payments to trade them.

Grayscale, part of a privately held blockchain-focused company, Digital Currency Group, is one of those trying to make it easier for investors to buy coins in familiar ways, preferably through the same brokers they use to buy stocks and bonds.

That’s where the Bitcoin and Ethereum Classic trusts come in. Grayscale has created eight such investment products, which are structured as private placements available to accredited investors—people with a net worth of $1 million or who make more than $200,000 a year. Each trust holds a particular amount of each coin, and investors buy them at their net asset value, paying annual fees—2% for bitcoin and 3% for ethereum classic.

Under SEC rules, those investments must be held for one year, after which they can potentially be sold on public markets to accredited or nonaccredited investors. The products are regulated by the Financial Industry Regulatory Authority, or Finra, the industry-funded overseer of broker-dealers. Finra declined to comment; the SEC didn’t respond to requests for comment.

For accredited investors, the investment trusts can make sense. For those buying their publicly traded securities, it may make less sense because the securities are quite a bit more expensive than the cryptocurrencies they represent. The Bitcoin trust traded at $12.28 late last week, a 64% premium to the $7.50 value of the bitcoin held in each unit. The Ethereum Classic trust traded at $43.70, a 194% premium to the $14.84 value of ethereum classic. This is in part a supply-and-demand issue.

“Given that the number of products out there that have those capabilities is pretty limited, there’s a lot of interest in these products right now, hence the premium,” says Michael Graham, an analyst with Canaccord Genuity who covers cryptocurrencies and tech. Canaccord was the sponsoring broker for the products and is the most active trader in the securities, Graham notes.

Not every institution has become comfortable with the securities. Bank of America Merrill Lynch (BAC) barred advisors from trading the Bitcoin trust in client accounts. (The bank didn’t respond to a question about whether that ban also applies to the Ethereum Classic trust.)

Andrew Left of Citron Research is shorting the Bitcoin trust, arguing that it deserves to trade at a 10% premium and will fall regardless of “where bitcoin goes.” He covered part of the short before the year end.

The smartest move, for those who qualify, may be to buy directly from Grayscale, accepting the risk of a one-year selling lockup. The biggest risk in that case is that the SEC approves a bitcoin or ethereum classic ETF, making it much easier for individuals and institutions to trade and reducing the premiums for Grayscale’s products.

Grayscale still offers both of its publicly traded products for direct sale at the net asset value, along with five others that track single coins and a sixth that includes a bundle of the largest coins. The six Grayscale products that don’t have public tickers yet are likely to get them over the next year, allowing investors to put together baskets of cryptocurrency-tied securities they can trade in their brokerage accounts.

Stahl first bought a small amount of the Bitcoin trust about three years ago at the publicly traded price, just to see how it traded. He then bought a larger chunk directly from Grayscale, and it has since been a “fabulous” investment, rising more than 1,000%. Another large holder, ARK Invest, offers ETFs, including the ARK Innovation ETF (ARKK) and the ARK Web x.0 ETF (ARKW), that hold the Bitcoin trust, among many other assets. Both have doubled since the start of 2017.

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Stahl thinks that buying the securities at their net asset value from Grayscale is still a smart move. Yet he would dissuade nonaccredited investors from buying either security on the open market. Investors may think they can time their trades, or that they can gauge the intrinsic value of these assets and use the securities almost like futures products, he says.

“There’s a lot of irrationality in all this stuff. But I would hope people aren’t that irrational,” said Stahl. “I don’t think it’s such a brilliant idea, to put it mildly, to buy things at that kind of a premium, even if you believe they’re going up 100 times.”

Write to Avi Salzman at avi.salzman@barrons.com