The introduction of a bitcoin futures ETF into the capital markets will open up opportunities in the leading cryptocurrency’s underlying technology, such as blockchain-focused funds.
One such fund to look out for is the Invesco Alerian Galaxy Blockchain Users and Decentralized Commerce ETF (BLKC). Advancements in blockchain technology can only help the case of the fund as more adoption permeates through various business sectors around the globe.
The fund itself is based on the Alerian Galaxy Global Blockchain Equity, Trusts and ETPs Index.
“The Index is comprised of stocks of companies that are materially engaged in the development of blockchain technology, cryptocurrency mining, cryptocurrency buying, or enabling technologies and exchange-traded products (‘ETPs’) and private investment trusts traded over-the-counter that are linked to cryptocurrencies,” Invesco noted on their product website. “The Index is computed using the net return, which withholds applicable taxes for non-resident investors. The Fund and Index are rebalanced monthly.”
The fund captures a mix of market cap and style allocations. It captures the stability of large-cap companies operating in the blockchain space while also obtaining growth through small-cap company exposure.
Currently, over 60% of the fund skews towards large-cap allocations, but holdings aren’t concentrated in a handful of stocks. The fund includes a diverse array of companies taking part in the cryptocurrency space, including mining companies like Marathon Digital Holdings and Hut 8 Mining Corp.
Investors also get exposure to the international market with holdings in the Cayman Islands, China, and Canada. Close to 50% of the fund’s holdings are still domiciled primarily within the United States.
Bitcoin ETF Set to Disrupt Industry
After its fair share of travails in trying to get Securities and Exchange Commission (SEC) approval, a bitcoin futures-focused ETF has now arrived. While the product will not focus directly on investing in bitcoin itself, but futures instead, it’s still a step forward for digital assets gaining traction in Wall Street circles.
“The ETF presents a disruption to what is available in the marketplace today,” said Karan Sood, CEO and managing director of Cboe Vest, a financial advisory platform in McLean, Virginia. “That’s what investors are excited about.”
Investors who may still be wary of investing in cryptocurrencies can opt for funds like BLKC. They can take part in the disruption without taking on any undue risk by investing in the technology itself.
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