In an effort to take advantage of China’s innovation in the cryptocurrency sphere, asset management firm Reality Shares launched the first ever blockchain ETF for the country. The company says their goal is to “democratize the world’s best investing ideas.”
According to a news release on June 20th, the Reality Shares Nasdaq NexGen Economy China ETF (Nasdaq: BCNA), will focus on Chinese companies committed to “developing, researching, supporting, or utilizing blockchain.” Investors can either speak with a financial advisor about adding the ETF to an account or invest directly on Reality Shares’ trading platform.
Businesses are evaluated across seven key factors, including their role in the blockchain ecosystem, membership in the Blockchain Institute, and blockchain product stage. Businesses must score high on these characteristics to qualify for BCNA. Reality Shares says their methodology is based on a series of quantitative factors and is designed to “pinpoint and evaluate the highest-scoring companies” in the blockchain universe.
BCNA is made up of 31 constituents and is currently set to rebalance semi-annually. Reality Shares CEO Eric Ervin says it gives investors the opportunity to easily access the emerging blockchain market in China.
He noted that the Asian nation is “quickly becoming a global epicenter for blockchain innovation” and believes its blockchain industry “presents an incredibly exciting and long-term investment opportunity.”
The company hopes BCNA will continue to capitalize on the overall growth of the Chinese economy. They point out how the country has several features that should be attractive to investors.
These include “historical non-correlation to the US market, the size of its equity market, and strong credit quality.” They also note how China had the most filed blockchain related patents in 2017.
Reality Shares entered the blockchain ecosystem in January after launching an ETF for investors interested in companies that are creating and implementing blockchain.
The Reality Shares Nasdaq NextGen Economy ETF (Nasdaq BLCN) is “comprised of companies committing material resources to developing, researching, supporting, innovating or utilizing blockchain technology for their proprietary use or for use by others.” BCNA currently serves as a compliment to BLCN.
Companies involved in the funds are researched and vetted by Reality Shares’ blockchain advisory board. Members include Eric Voorhees, founder of Shapeshift, Marco Santori, president and chief legal officer of Blockchain.com, Jeff Garzik, an early bitcoin developer and the creator of Metronome, and Matthew Roszak, founder of Tally Capital.