Bitcoin is already on a blistering pace to start 2024. That’s due in large part to U.S.-listed spot ETFs dedicated to the largest cryptocurrency. However, more upside could be in store. That’s because some market participants are showing increased interest in the cryptomarket.
That could be a positive for ETFs such as the Amplify Transformational Data Sharing ETF (BLOK). There’s more to the blockchain and BLOK stories than bitcoin ties. But the digital currency’s 2024 surge has been an undoubted catalyst for the ETF. That’s highlighted by a 21% year-to-date gain.
Indeed, some of that upside has been facilitated by the audience of bitcoin investors broadening due to the aforementioned launch of the spot ETFs. The expansion of the bitcoin investor base isn’t confined to retail market participants. It includes professional investors. And that indicates there could be a credible catalyst afoot for BLOK’s crypto-correlated equity holdings.
Hedge Funds Stepping Into the Cryptomarket
In what could be a bullish sign for some of the stocks held by BLOK, some hedge funds are looking to increase their exposure to cryptomarkets. Max Minton, Goldman’s Asia Pacific head of digital assets, told Bloomberg in a recent interview that large clients are already participating actively in cryptomarkets or considering doing so.
He said that increased interest has been helped in part by the launch of spot bitcoin ETFs in the U.S. Some experts believe a similar scenario could play if the SEC approves spot ether ETFs. That move that could also benefit some BLOK holdings.
“The majority of demand comes from Goldman’s existing clients, mainly the traditional hedge funds. The bank is also expanding into ‘a wider universe of clients,’ including asset managers, bank clients and select digital asset firms,” reported Bloomberg, citing Minton.
Another point of interest to investors considering BLOK is that Goldman uses blockchain technology to provide tokenized-asset trading to clients. That’s just one example of the expanding use of blockchain in the financial services industry. That industry has already been a rapid adopter of blockchain.
“Besides trading, Goldman is active in tokenizing traditional assets using blockchain. The bank launched a digital-asset platform called GS DAP, and most recently participated in a pilot test on a blockchain network that connects banks, asset managers and exchanges,” according to Bloomberg.
The $744.7 million BLOK holds 53 stocks and is actively managed. At least 80% of its holdings must be engaged “in the development and utilization of blockchain technologies,” according to the issuer.
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