The ETF will provide investors exposure to crypto and blockchain without having to own any digital assets
By Shashank Bhardwaj
The world’s largest asset manager BlackRock has officially launched a blockchain-focused ETF that provides investors with exposure to the crypto and blockchain industry without needing to directly own digital assets. The company, which manages around $10 trillion in assets, added the Blockchain and Tech ETF (IBLC) to its iShares product line on Wednesday, April 27.
The ETF application was submitted to the Securities and Exchange Commission in January, and it sought to track the investment results of an index made up of U.S. and non-U.S. companies involved in the development, innovation, and the use of blockchain and crypto technology.
The ETF, which has approximately $4.7 million in net assets (excluding cash positions and derivative exposures), does not own cryptocurrencies or digital assets directly but rather tracks multiple international companies involved in the industry. The focus is mostly on American and international companies active in the space, such as exchanges. It comprises 41 separate holdings, with Coinbase, the leading US-based cryptocurrency exchange, accounting for 11.45% of the total. Bitcoin miners Marathon Digital Holdings (11.19 %) and Riot (10.4%) will also be tracked by the ETF, as will payments giant PayPal, which started providing crypto services in 2020.
Rachel Aguirre, BlackRock's head of US iShares product, said that the ETF is a "gradual entry point into the blockchain ecosystem" and includes holdings like crypto exchanges, crypto miners, and underlying technologies. “The entire ecosystem around the blockchain has seen rapid growth these past two years, and there are a whole host of economic and societal factors driving this growth," she added.
"Blockchain tech is allowing independence and control of personal data while enabling financial inclusion for billions of unbanked consumers,” the company said on its iShares webpage.
Institutional investors are now increasingly becoming invested in crypto and blockchain ETFs as a means to gain exposure to the cryptocurrency industry. BlackRock's ETF follows brokerage firm Fidelity's launch of two ETFs which will monitor the crypto sector and the metaverse, a more immersive form of the internet on which many large corporations are now betting.
The writer is the founder at yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash
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