Best Blockchain ETFs – Blockchain is like the foundation of digital currencies such as Bitcoin and Ethereum. However, it can be used in many other areas, possibly transforming any task that involves keeping records in a database and more.
If you want to take advantage of the exciting possibilities of blockchain technology, you can use blockchain exchange-traded funds (ETFs) to invest easily in many companies that are working on blockchain strategies.
RBCBlogs Advisor checked out the best blockchain ETFs currently on the market and sorted them based on how much money they manage to help you make informed investment decisions in this new category.
The Best Blockchain ETFs Of February 2024
The SEC has given the green light to more than 25 blockchain and Bitcoin ETFs for trading in the United States. These ETFs cover both publicly traded blockchain companies and Bitcoin futures.
We chose the best blockchain ETFs for this list using the following method:
- Don’t choose ETFs that only trade Bitcoin futures; look for ones that include publicly traded blockchain companies.
- Also, check if the remaining ETFs have over $15 million in total assets under management (AUM).
We now have Six funds after going through this process. There are additional requests for approval from the SEC for more blockchain ETFs. As the world of blockchain ETFs keeps changing, we’ll develop a better way to choose the best ones from an even bigger group of similar funds.
What is a Blockchain Technology?
Blockchain is like a digital record book that keeps track of information, often about transactions involving digital money. It spreads this record across many computers in a network.
All the computers in the network have the same exact record book. This makes it challenging (but not impossible) for anyone to hack or cheat the system.
Breaking down the word “blockchain” can make it easier to understand how the system operates.
Computers in the network store information like smart contracts, Bitcoin transactions, or supply chain data in blocks. These blocks are added to a constantly changing digital ledger called the “chain.” Every time new information is added, all the computers in the network get updated with a copy of the entire database.
Before new information is added to the system, all points must agree that it is valid. In certain cases, like with cryptocurrencies, most points must confirm that a coin hasn’t been used multiple times. In a logistics company, it might involve various points recording or checking the arrival or departure of shipments.
What are Blockchain ETFs?
Blockchain ETFs are special investment funds that include stocks of companies involved in using or creating blockchain technology. They usually invest in a broader range of assets compared to Bitcoin or crypto ETFs, which concentrate more on following the prices of specific cryptocurrencies.
Cryptocurrencies such as Bitcoin and Ethereum are the main ways people use blockchain right now. However, blockchain can be used for many other things besides just cryptocurrencies. For example, Walmart’s Canadian division used blockchain to make a computerized system for handling invoices and payments for its logistics partners.
The listed ETFs invest in lots of different companies. We can group them into a few main categories:
- Some businesses own cryptocurrency. For instance, MicroStrategy and Tesla have a lot of Bitcoin and other digital assets.
- There are also companies involved in crypto exchanges and mining. Coinbase is a major cryptocurrency exchange and Marathon Digital mines Bitcoin.
- Certain financial services firms, like Galaxy Digital Holdings, handle crypto assets based on blockchain technology.
- Tech companies like NVIDIA Corp make microchips commonly used to support blockchain systems.
Why Invest in Blockchain ETFs?
Blockchain is a new and exciting technology still in the early stages of development. While cryptocurrencies have been getting a lot of attention for big gains and losses, other practical uses of blockchain are not as well-known.
Big, well-known companies have tried out blockchain, but smaller, specialized companies are making blockchain and crypto a central part of what they do. However, so far, there hasn’t been a super successful app that proves blockchain is crucial for the future of business and technology.
Investing all your money in the stocks of just one or a few companies that focus on blockchain or cryptocurrency is very risky. To lower this risk, it’s safer to choose a diversified blockchain ETF. These ETFs invest in many different stocks, sometimes dozens or even hundreds, giving you a broader and less risky way to invest in the industry using a single fund.
Because the blockchain industry is changing quickly, picking a blockchain ETF for your investment portfolio might be the smartest decision.
Read Also: Best Cryptocurrency Apps and Exchanges
Conclusion
The information on RBCBlogs Advisor is just for learning, not for personal financial advice. Your money situation is different, so the things we talk about may not be the best for you. We don’t give financial advice, and we don’t tell people what stocks or investments to buy or sell. Also, the performance numbers we mention might be different now, and how things did in the past doesn’t predict the future.
Muje robi koin
Muje ribi koin