First Blockchain ETFs Debut: Here’s What You Need To Know

First Blockchain ETFs Debut: Here’s What You Need To Know

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by: Wayne Duggan, Benzinga Staff Writer

 

Just as the global cryptocurrency market is hitting its biggest rough patch in months, two new ETFs based on blockchain technology are making their market debuts. The Reality Shares Nadaq NextGen Ecconomy ETF BLCN and the Amplify Transformational Data Sharing ETF BLOK are now open for business.

Here’s what investors need to know about each.

 

The BLCN ETF

The BCLN ETF holds shares of companies that committee “material resources” to blockchain technology research and development. Each company included is analyzed and assigned a “Blockchain Score” by the Reality Shares board. The Blockchain Score quantifies how much each company is expected to benefit from the advancement of blockchain technology.

Every six months, the BCLN is rebalanced to include the 50 to 100 companies with the highest Blockchain Scores. The index weighting is also rebalanced based on Blockchain Score as well.

According to the Reality Shares website, the BCLN’s initial top holdings include Intel Corporation INTC 2.49%Overstock.com IncOSTK 4.03% and International Business Machines Corp. IBM 2.26%

 

The BLOK ETF

The BLOK ETF also focuses on companies that are developing blockchain or blockchain-related technology. Holdings include companies researching, implementing and profiting from blockchain technologies. It also includes companies with blockchain-related partnerships that could prove financially beneficial. Amplify classifies each company included in the index as either “core” or “secondary” based on how closely-tied the company’s business is to blockchain development.

Amplify has said it plans to be particularly active in managing the BLOK fund to make sure it stays on top of the rapidly-changing blockchain landscape. The fund’s holdings and balance could potentially be adjusted on a daily basis. Subadvisor Toroso Investments will select the fund’s holdings and manage its investment strategy, while Exponential ETFs will construct the portfolio and execute trades.

According to the Amplify website, top holdings include Taiwan Semiconductor Mfg. Co. Ltd. (ADR) TSM 1.23%DIGITAL GARAGE OTCDLGEF and SBI HOLDINGS INC SBHGF 5.83%.

 

Blockchain Could Be The Real Cryptocurrency Winner

Cryptocurrencies like bitcoin and Ethereum have generated a lot of excitement among investors, but some experts say the underlying blockchain technology, not the cryptocurrencies themselves, is the real gold mine for investors.

“This is an industry that we think that over several decades will be as revolutionary as the internet. We're going to have several million people working in this industry, if not tens of millions," Antonis Polemitis, blockchain expert and CEO of the University of Nicosia, said this week, according to CNBC.

Gartner estimates that blockchain technology could add $3.1 trillion in value to the global business world by 2030.

 

© 2018 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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