New ETFs target blockchain, digital assets and disruptive tech companies for long-term capital growth.
Key Takeaways
- State Street launches three actively managed ETFs focused on digital assets and disruptive technologies.
- The new ETFs, subadvised by Galaxy Asset Management, aim to capitalize on blockchain and digital asset market opportunities.
State Street Global Advisors has announced three crypto exchange-traded funds (ETFs) sub-advised by Galaxy Asset Management. The ETFs invest in crypto and firms from the blockchain industry.
The new funds are SPDR Galaxy Digital Asset Ecosystem ETF (DECO), SPDR Galaxy Hedged Digital Asset Ecosystem ETF (HECO), and SPDR Galaxy Transformative Tech Accelerators ETF (TEKX).
“Digital assets and blockchain technology have the power to transform financial markets as well as the economy over the next decade, and a number of companies will grow and flourish thanks to their contribution to this transformative technology,” stated Anna Paglia, chief business officer for State Street Global Advisors.
According to the announcement, the ETFs seek to provide exposure to crypto and firms at the forefront of blockchain and digital asset technologies.
In June, State Street Global Advisors and Galaxy Asset Management launched the SSGA Active Trust, aiming to provide diverse crypto investment opportunities.
A month later, State Street debuted its SPDR Galaxy Digital Asset Ecosystem ETF, targeting investment in crypto equities and futures amidst increasing market demand.
Mixing traditional finance and crypto
The DECO ETF focuses on companies benefiting from blockchain and crypto adoption, such as Bitcoin miners Core Scientific, Hut 8, and Terawulf, while also adding positions to traditional finance companies such as Meta and Visa. The fund also has positions on Fidelity’s FBTC spot Bitcoin ETF.
Meanwhile, HECO has a similar portfolio distribution for companies but swapped Meta and FBTC shares for BlackRock and BlackRock’s IBIT spot Bitcoin ETF shares. The HECO also incorporates covered call and protective put options to manage volatility.
TEKX targets companies supporting new disruptive technologies, including blockchain and artificial intelligence, while also adding some US dollar allocations.
“With the rapid evolution of digital assets and blockchain technology, it’s crucial to have a dynamic approach to investing in this asset class,” stated Chris Rhine, Head of Liquid Active Strategies at Galaxy and lead portfolio manager of the three ETFs.
Rhine added that these new ETFs allow investors to capitalize on opportunities in the blockchain industry while keeping volatility in check.
Moreover, the new crypto-related products are aimed at potentially appealing to a wider range of investors, boosting crypto users onboarding.
