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You don't report cryptocurrency if you purchased it.
Cryptocurrency is taxed when you receive it as payment or have a transaction where you sell or trade it. If you just buy it and hold onto it, it won’t be taxed until you do something with it.
Related information:
Your question is whether shares in an exchange-traded mutual fund that invests crypto currencies is itself a virtual currency.
I think the answer is pretty clearly no. You own shares in a regulated investment company. You don't own virtual currency. When you sell your ETF shares you'll have a capital gain or loss and receive a 1099-B. The IRS will track that. If for some reason the ETF liquidated and distributed to you its underlying assets, that would be different (and very unlikely).
The virtual currency questions are for buying/selling the actual cyrpto currencies that the IRS can't otherwise track.
See the 1040 instructions of this IRS FAQ
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