BlackRock launches blockchain technology ETF

BlackRock has launched a blockchain technology ETF as it notes the continued growth of digital assets is "driving demand" for investment strategies in this space.

The iShares Blockchain Technology UCITS ETF is listed on Euronext, has a total expense ratio of 0.5% and tracks the NYSE FactSet Global Blockchain Technologies Capped index.

It is made up of 35 global companies from both developed and emerging markets. 75% of the exposure is to companies whose primary business is related to blockchain such as crypto miners and exchanges. The remaining 25% is to companies that support the technology such as semiconductor companies.

BlackRock added that it will not invest directly in cryptocurrencies.

Omar Moufti, product strategist for thematic and sector ETFs at BlackRock said the firm believes "digital assets and blockchain technologies are going to become increasingly relevant for our clients as use cases develop in scope, scale and complexity".

"The continued proliferation of blockchain technology underscores its potential across many industries," he continued.

According to BlackRock, blockchain has led to decentralized payment systems worth a notional $1tn market cap for cryptocurrencies and digital assets.

The asset manager also highlighted trading volumes for digital assets has improved five times year-over-year, from $10bn average daily volume at the end of 2017 to $53bn at 31 August 2022, according to The Block.