Horizons ETFs Management is the latest exchange traded funds issuer to reveal plans for a blockchain ETF.
“A blockchain is a digitized, decentralized, public ledger of all cryptocurrency transactions. Constantly growing as ‘completed’ blocks (the most recent transactions) are recorded and added to it in chronological order, it allows market participants to keep track of digital currency transactions without central record keeping. Each node (a computer connected to the network) gets a copy of the blockchain, which is downloaded automatically,” according to Investopedia.
The Horizons Blockchain ETF would track the Horizons Blockchain Index.
“The Horizons Blockchain Index is a proprietary Index that primarily invests in U.S. and foreign equity securities and seeks to invest in companies that stand to benefit from the growth of blockchain technology,” according to a Horizons filing with the Securities and Exchange Commission (SEC). “The emergence and adoption of blockchain technology, a form of distributed ledger technology, will likely change how business transactions and operations take place, paving the way for unprecedented levels of growth and innovation.”
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Earlier this month, Amplify ETFs, the exchange traded funds issuer behind the Amplify Online Retail ETF (NasdaqGM: IBUY), among other products, revealed plans for the Amplify Blockchain Leaders ETF. That news was followed by headlines of Reality Shares also planning a blockchain ETF.
In mid-November, a filing from First Trust, one of the largest issuers of smart beta exchange traded funds, revealed plans for the First Trust Indxx Blockchain ETF. The First Trust ETF will track the Indxx Global Blockchain Index.
The Horizons Blockchain Index “attempts to identify companies within the global equity markets that stand to directly participate in the growth associated with the adoption and integration of blockchain technology. Currently, the Index universe includes over 20 industries and focuses on technology end-users along with suppliers and providers likely to benefit from the growth of blockchain technology. This approach is intended to capture the entire scope of growth and emerging innovations within the universe,” according to the SEC filing.
That index will only hold companies with market values of at least $250 million and average daily dollar volume of at least $1 million.
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