BlackRock Lists Blockchain ETF Days After Similar Fidelity Launch

key takeaways

Leveraging blockchain technology for payments, contracts and consumption represents crypto’s “broader opportunity,” company says
Launch comes after Fidelity listed its crypto and metaverse ETFs last week

BlackRock has launched its blockchain ETF and labeled the segment a “megatrend” just days after competitor Fidelity brought to market a similar fund.

The world’s largest asset manager, which manages roughly $10 trillion in assets, added the iShares Blockchain and Tech ETF (IBLC) to its megatrends product suite on Wednesday.

BlackRock’s thematic platform alone comprises 43 products with more than $50 billion in assets under management.

“The expansion of our megatrends line-up today reflects the power of the millennial and rise of the self-directed investor, whose buying habits have reshaped mainstream consumer behaviors, and in turn, the companies in which they invest,” Rachel Aguirre, BlackRock’s head of US iShares product, said in a statement.

IBLC, which the firm filed for in January, seeks exposure to global companies at the forefront of the “development, innovation and utilization” of blockchain and crypto technologies, according to the company. It does not invest in cryptocurrencies directly.

The new blockchain fund launched about a week after Fidelity listed its Crypto Industry and Digital Payments ETF (FDIG) and its Metaverse ETF (FMET). Both funds carry an expense ratio of 39 basis points.

The BlackRock product, which costs 47 basis points, currently has 34 holdings. Its largest allocations are to crypto exchange Coinbase, as well as bitcoin miners Marathon Digital and Riot Blockchain, which each account for more than 10% of the portfolio.

Other top holdings include Galaxy Digital, IBM, Hive Blockchain Technologies, Bitfarms and PayPal.

In tandem with the ETF launch, BlackRock published a paper highlighting three areas experiencing significant permanent changes: new consumer, industrial renaissance and medical breakthroughs.

“While most of the market attention has focused on the price and volatility of cryptocurrencies themselves, we believe the broader opportunity — leveraging blockchain technology for payments, contracts and consumption broadly — has not yet been priced in,” the paper states.

Cryptoassets offer financial inclusion to the unbanked and allow users to regain control over the $150 billion annual market for their personal data, according to the paper. BlackRock’s research also highlights central bank digital currencies (CBDCs), noting that 87 countries are currently exploring them.

A BlackRock spokesperson declined to comment further on its plans within the crypto space.

Larry Fink, the company’s CEO, said in a shareholder letter last month that the war in Ukraine could accelerate the adoption of digital currency.

BlackRock and Fidelity participated in a funding round for peer-to-peer payments technology company Circle earlier this month.

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