On Wednesday, April 27, financial services giant BlackRock announced its first Blockchain ETF: iShares Blockchain and Tech ETF (IBLC). BlackRock said that this new ETF will be part of its “megatrend” product suite.
The BlackRock Blockchain ETF (IBLC) will provide investors with exposure to the block chain industry and cryptocurrencies 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. Furthermore, the US SEC filing shows that 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 “megatrend” themed platform has more than 43 products with more than $50 billion in assets under management. In a statement, Rachel Aguirre, iShares product manager for BlackRock in the US, said:
The expansion of our lineup of megatrends today reflects the power of millennials and the rise of the self-directed investor, whose buying habits have reshaped the behaviors of mainstream consumers and, in turn, the companies they invest in.
The largest single holding in the IBLC ETF blockchain is from the cryptocurrency exchange Coinbase (NASDAQ:COIN). The exchange alone accounts for 11.45% of the total fund. Next up is Bitcoin mining giant Marathon Digital (NASDAQ:MARA), which makes up 11.19% of the total fund. Additionally, Riot Blockchain (NASDAQ:RIOT) accounts for 10.41% of total funds.
The IBLC ETF also has a healthy 9.15% share of the USD cash position, showing that it is ready for future acquisitions.
BlackRock’s growing interest in the crypto industry
Over the past year, BlackRock’s interest in the crypto space has increased significantly. The asset management giant is working on multiple fronts in this sector. In early February, BlackRock said which had plans to offer cryptocurrency trading services to institutional clients. Furthermore, he has also been considering the idea of offering loans against crypto collateral.
Along with the launch of its new ETF, BlackRock has published a new report which highlights the key areas of the market that are undergoing major changes. The asset management giant also shared a bullish outlook for the crypto industry. Furthermore, BlackRock believes that the blockchain industry has yet to realize its true potential.
“We believe that the broader opportunity, leveraging blockchain technology for payments, contracts and consumption in general, has not yet been appreciated,” he added.
The 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 blockchain has seen rapid growth in the last two years, and there are a lot of economic and social factors driving this growth,” she said.
In its recent report, BlackRock also talks about adopting central bank digital currencies (CBDC).