Canadian Regulator Gives The Nod For First Blockchain ETF, Two More in the Queue
The crypto markets are currently under a big selling pressure as the market was gripped with a major correction of Friday, with the overall valuation of the crypto market going below $400 billion. This is a whopping 50% correction since the year of 2018 started with crypto markets having above $800 billion market cap.
One thing that has contributed in spoiling the party for the crypto market is the South Korean regulatory approvals which have left the global investors worried. However, it seems that in spite of all this, some investors and companies are at all not deterred by the existing scenario.
Canada’s commodities and securities watchdog - Ontario Security Commission (OCS) - has approved the country’s first blockchain exchange-traded-fund (ETF) and is set to launch next week on the Toronto Stock Exchange. Harvest Portfolios is the company behind the blockchain ETF and will submit its final proposal to the local regulators.
According to Harvest Portfolio, the fund will invest “in equity securities of issuers exposed, directly or indirectly to the development and implementation of blockchain and distributed ledger technologies”.
Experts believe that businesses are looking to expand into blockchain funds as crypto funds do not “have as many legs in viability”. The fund by Harvest Portfolio will be known as Blockchain Technologies ETF and will be using the HBLK ticker having a commission of 0.65%. The HBLK tokens will further track the movement of Harvest Blockchain Technologies Index that lists some blockchain-oriented startups as well as large-cap blockchain companies.
Two more Canadian companies - Evolve Funds Group Inc and First Trust Portfolios Canada are are planning to launch their blockchain funds very soon.
First Trust will have a BLCK ticker for its First Trust Indxx Innovative Transaction & Process ETF and will be tracking the Indxx blockchain Index. Upon going live, it will have a management fee of 0.80%.
Karl Cheong, head of ETFs for First Trust Portfolios Canada, told the Globe and Mail: “Every conversation we are having with clients, regardless if we are talking about a Canadian equities product or a US equity product , inevitably leads to a discussion about blockchain or bitcoin.”
"The commentary out there right now is that blockchain is the more viable option while bitcoin may not have as many legs in terms of viability; but bitcoin could be the Friendster before the Facebook shows up in the cryptocurrency space.”
Similarly, Evolve Funds’ ETF will LINK ticker and a management fee of 0.75%. This fund be tracking companies involved with research, development and utilization of distributed ledger technology (DLT).
While taking to the Globe and Mail, Raj Lala, president and CEO of Evolve, said “Blockchain technology is poised to disrupt virtually every business and industry, including financial services, real estate, health care and government.”
“Currently, at the base of every digital currency, many compare blockchain to the second coming of the Internet. I believe we are Canada's first actively-managed blockchain ETF, which will allow us to be nimble and potentially capitalize on emerging opportunities.”