Back to top

Image: Bigstock

Are Blockchain ETFs Set to Rally?

Read MoreHide Full Article

Though the SEC is not ready give its nod to a formal bitcoin ETF for all, the atmosphere is warming up to digital currencies. Constant endeavors by different companies and countries to promote digital currencies have been noticed of late (read: VanEck, SolidX Pull Out Bitcoin ETF Proposal From SEC Review).

Switzerland’s central bank is working with the country’s stock exchange to assess the possible use of digital currencies in trading. On Oct 8, 2019, Swiss stock exchange operator SIX Group said it was partnering with the Swiss National Bank (SNB) on a proof of concept to “explore how digital central bank money could be used in the settlement of tokenized assets between market participants.”

SIX Group has been working on a digital exchange that would deploy blockchain, the underlying technology behind cryptocurrencies like bitcoin, issue and settle trades in digital assets. The core idea is to “tokenize” traditional assets like shares and bonds — “essentially creating digital versions of such securities — a move the firm claims would reduce the time it takes to complete a trade, from a number of days down to less than a second,” per CNBC.

Other Cryptocurrencies and Blockchain Initiatives

Not only the Swiss stock exchange operator, Facebook (FB - Free Report) is also exploring ways tointroduce its libra cryptocurrency. The social media giant is striving to gain Washington’s support on its crypto plan. In fact, Facebook startled the investing world, regulators and lawmakers on Jun 18 with its announcement of launching its own digital coin called Libra in 2020, per Reuters. Libra will be backed by a spectrum of international currencies and other investments (read: Facebook Crypto Plans in Doubt, Blockchain ETFs in Focus).

Vanguard has also collaborated with Nasdaq Ventures-backed blockchain startup Symbiont to develop a trading platform for the $6-trillion currency market, the companies said. With the new platform, Vanguard, intends to cut back on transaction costs for the trillions of dollars worth of currencies it trades annually by “boosting peer-to-peer trading for investors, connecting them directly via blockchain technology.”

Major global central banks have been looking into the creation of their own digital currencies, with China’s central bank having recently said that it is close to releasing its own virtual coin. Meanwhile, “Bank of England Governor Mark Carney has proposed a digital alternative to the U.S. dollar to become the world’s reserve currency,” according to an article published on

These efforts and initiatives hint at an upcoming rally in blockchain ETFs. Cryptocurrencies across the board have been rallying hard in 2019, with Bitcoin gaining more than 120% this year.

So, investors can familiarize with the concept through blockchain ETFs like Reality Shares Nasdaq NexGen Economy ETF BLCNAmplify Transformational Data Sharing ETF BLOK and First Trust Indxx Innovative Transaction & Process ETF LEGR.

Want key ETF info delivered straight to your inbox?

Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

Meta Platforms, Inc. (FB) - free report >>