BlackRock's latest ETF invests in 35 blockchain firms

By: Dickson Arinze

September 30, 2022 8:34 AM

BlackRock ETF product strategist Omar Moufti predicted that "digital assets and blockchain technologies will become increasingly relevant for our clients."

World-leading asset manager BlackRock has just introduced an exchange-traded fund (ETF) to give European investors access to the blockchain industry, and there have been rumors that a Metaverse-specific ETF is in the works.

On September 27th, a brand new exchange traded fund (ETF) based on blockchain technology was released; it is called the iShares Blockchain Technology UCITS ETF (BLKC).

BlackRock has stated that 75% of its holdings are blockchain-related companies like miners and exchanges, with the remaining 25% being blockchain ecosystem support companies.

Out of a total of 50 holdings, including fiat cash and derivatives, 35 are international corporations; the fund does not invest directly in cryptocurrencies.

Since launching a private spot Bitcoin trust on August 11th, BLKC is BlackRock's most recent move into the digital assets space.

The ETF will "allow our clients the opportunity to engage with global companies leading the development of the emerging blockchain ecosystem," Omar Moufti, BlackRock's product strategist for thematic and sector ETFs, said in a Finextra report from September 29.

"We anticipate that as the scope, scale, and complexity of use cases grow, digital assets and blockchain technologies will become more relevant for our clients."

Coinbase (13.20%), U.S. dollars in currency reserves (13%), the financial technology company Block (11.40%), and the cryptocurrency mining companies Marathon Digital Holdings (11.13%) and Riot Blockchain (10.50%) make up the top five holdings of the fund.

As of September 28th, the portfolio included 50 holdings, including 23 IT companies, 6 financial companies, 1 industrial company, and 1 communications company.

On the other hand, Bloomberg reported on September 29 that BlackRock is reportedly developing an ETF called iShares Future Metaverse Tech and Communications ETF, which would focus on the Metaverse.

In the report, it was stated that the fund could invest in "firms that have products or services tied to virtual platforms, social media, gaming, digital assets, augmented reality, and more" (emphasis added). The fund's fees and ticker are not yet disclosed.

The Metaverse ETF was launched after BlackRock Technology Opportunities Fund co-portfolio manager Reid Menge described the platform in a blog post on February 14. Menge called the Metaverse a "revolution in the making."

Transcripts from the company include the word "Metaverse." The information comes from Morgan Stanley 2021, as reported in BlackRock Market Minute.

Coinbase announced a partnership with BlackRock on August 4 and appears to be benefiting from the partnership, judging by its heavy holdings in BLKC.

Because of this collaboration, Coinbase Prime is now available to institutional investors.