Blockchain, the underlying technology that forms the basis for cryptocurrencies, continues to expand despite its main purveyor, Bitcoin, down to the $6,000 mark after reaching a high of $20,000 back in mid-December of last year.
Nonetheless, blockchain itself has been a hot topic with companies like investment firm UBS looking to implement the transactional technology in the financial sector.
China, in particular, is no stranger when it comes to using blockchain technology. In fact, China’s central bank was working on a national cryptocurrency last year before the government essentially pulled the plug on the idea with cryptocurrency regulations, but blockchain technology research and development has the full support of the country.
On March 28, the Peoples Bank of China (PBoC) held a 2018 National Currency Gold and Silver Work Video and Telephone Conference with cryptocurrency amongst the topics. The PBoC is planning a launch of its own digital currency called DCEP (Digital Currency for Electronic Payment), which will undergo continued development through 2019. PBoC governor Zhou Xiaochuan said the currency’s focus would be on “convenience, rapidity, and low cost in a retail payment system while taking into account security and protection of privacy.”
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One company looking to capitalize on the future growth of blockchain technology in China is Reality Shares, an innovative asset management firm, exchange-traded fund (ETF) issuer and index provider. Today, it launched the Reality Shares Nasdaq NexGen Economy China ETF (NASDAQ: BCNA) that will give investors exposure to companies that could be in the forefront of the blockchain technology revolution in China.
“China is quickly becoming a global epicenter for blockchain innovation. In 2017, the nation filed for more blockchain-related patents than any other country in the world1, and the Chinese government recently endorsed blockchain technology as an economic ‘breakthrough,’” said Eric Ervin, CEO of Reality Shares.
BCNA tracks the Reality Shares Nasdaq Blockchain China Index and screens Chinese companies for possible investments if they commit material resources to developing and implementing blockchain technology. The index rebalances semiannually and is comprised of 31 constituents.
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This is not the first foray into a blockchain ETF as Reality Shares already has the Reality Shares Nasdaq NexGen Economy ETF (NASDAQ: BLCN), which is currently up 2.21% the past 30 days. The company hopes that this new financial innovation in exposure to other markets willing to implement blockchain technology will be a success.
“China’s blockchain industry presents an incredibly exciting and long-term investment opportunity, and through BCNA, investors can now easily access this emergent market,” said Ervin.
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