A new blockchain exchange-traded fund has surfaced in the cryptocurrency space called First Block Capital. The firm is based out of Vancouver, Canada and is still under construction. Investments from companies such as Walmart are believed to be powering the blockchain seedling.
The project is still in its stage where it is undergoing the process of regulatory approval. This is the final stage of the establishment of First Block Capital. The approval is regarding an FBC Digital Ledger Technology Adopters ETF. As stated by the Chief Executive Officer of the firm, Bill Stormont in an interview, the ETF is set to be traded on Aequitas NEO Exchange in Canada next month. He also added:
“The fund won’t rely on the blockchain sector being fashionable. You’re looking at companies that are going concerns. They don’t necessarily live or die by their blockchain investments but as they integrate them, our hope is that these kind of names perform.”
There are similar funds in the United States, namely, the Reality Shares Nasdaq NexGen Economy ETF and the AmpliTransformationalnal Data Sharing ETF. These are the firms believed to be an inspiration to First Block of Canada. Reality Shares was listed only at the beginning of this year and was observed to raise an amount of about $300 million in its first fortnight.
On the other hand, there existed criticism against these ETFs for charging their investors a heavy premium on holding the most basic financial stocks such as Intel Corp., Cisco Systems Inc, Nvidia Corp, among others.
According to Stormont, while it is hard to avoid the overlapping of funds, the aim of his company is to discover a greater range of stocks for its customer holdings. He also stated:
“Names like Nvidia, every ETF will hold that but we’ll also bring in names like Maersk or Walmart. It’s not just focused on tech companies.”
Bruce Campbell, who is a portfolio manager at StoneCastle Investment Management Inc., will be responsible for sub-managing this new fund. A one-fourth of the portfolio is decided to be invested developers and cryptocurrency miners that carry a higher risk. StoneCastle is a fund-investment management firm that claims to protect the capital, build assets and manage risks.
The portfolio expert stated that companies such as IBM, Amazon and Maersk that are integrating and utilizing the blockchain technology into their business are the goals for this ETF. Maersk is the largest container shipping company in the world that had recently built its blockchain-backed platform with IBM.
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