World’s largest asset manager BlackRock debuts its first blockchain ETF

  • BlackRock said that it sees a huge opportunity unfolding in the crypto and blockchain industry.
  • BlackRock’s IBLC blockchain ETF will track some of the public listed and global companies operating in the crypto and blockchain space.

On Wednesday, April 27, financial services giant BlackRock announced its debut blockchain ETF – the iShares Blockchain and Tech ETF (IBLC). BlackRock said that this new ETF will be part of its “megatrend” product suite.

BlackRock’s blockchain ETF (IBLC) will provide investors with exposure to the blockchain and crypto industry without directly owning the digital assets. Rather, the $4.7 million IBLC ETF will track the number of global companies operating in these two industries. Also, the filing with the U.S. SEC shows the IBLC ETF seeks exposure to companies at the forefront of “development, innovation, and utilization”.

BlackRock is the world’s largest asset manager with more than $10 trillion in assets under management. Its thematic platform “megatrend” has more than 43 products with over $50 billion in assets under management. In a statement, Rachel Aguirre, BlackRock’s head of US iShares product, said:

The expansion of our megatrends line-up today reflects the power of the millennial and rise of the self-directed investor, whose buying habits have reshaped mainstream consumer behaviors, and in turn, the companies in which they invest.

The largest single individual holding in the blockchain ETF IBLC is of crypto exchanges Coinbase (NASDAQ: COIN). The exchange alone makes up 11.45 percent of the total fund. The next is Bitcoin mining giant Marathon Digital (NASDAQ: MARA) which constitutes 11.19 percent of the total fund. Also, Riot Blockchain (NASDAQ: RIOT) accounts for 10.41 percent of the total funds.

The IBLC ETF also has a healthy holding of 9.15 percent in USD cash position showing readiness for future acquisitions.

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BlackRock’s growing interest in the crypto industry

Over the last year, BlackRock’s interest in the crypto space has surged significantly. The asset management giant is working on multiple fronts in this sector. Earlier in February, BlackRock said that it had plans to offer crypto trading services to institutional clients. Furthermore, it has been also mulling the idea of offering loans against crypto collateral.

Along with the release of its new ETF, BlackRock has published a new report that highlights the key areas of the market that are witnessing some major changes. The asset management giant also shared a bullish outlook for the crypto industry. Also, BlackRock believes that the blockchain industry is yet to realize its true potential.

“We believe the broader opportunity — leveraging blockchain technology for payments, contracts and consumption broadly — has not yet been priced in,” it added.

Head of the Developed Markets Portfolio Management team Rachel Aguirre said that the ETF is a “gradual entry point into the blockchain ecosystem”. “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 said.

In its recent report, BlackRock also talks about the adoption of central bank digital currencies (CBDCs).

About Author

Bhushan is a FinTech enthusiast and holds a good flair for understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In his free time, he reads thriller fictions novels and sometimes explores his culinary skills.

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