The simplest way to invest in a blockchain is to buy the corresponding cryptocurrency. Every time you buy Bitcoin or Ether, you are making an investment in the blockchain behind it.
The current problem with direct investment is that many users continue to be skeptical about the blockchain market. They worry that they don’t understand the technology well enough to make a good investment or that their transactions may lose money. They read horror stories about scams and software bugs that caused people to suffer huge losses.
Still, they see the great year-over-year performance of the cryptocurrency market and want to get a share of that profit.
This desire has led to the development of financial instruments that allow investment in the blockchain market without buying cryptocurrencies. The most common solution is exchange-traded funds.
Analysts at brokerage firms identify publicly traded companies operating in the blockchain industry. For example, IBM provides clients with guidance on creating and using custom blockchains. IBM is not just a blockchain stock, the company is an actor in the blockchain market and thus made the list. Oracle and Visa are known to invest in blockchain research, so analysts treat them as blockchain companies.
So, a blockchain ETF might include these three companies and perhaps dozens of other blockchain technology companies, because financial performance is all about the success of blockchain startups. This fund is therefore an indirect way to invest in the overall blockchain market. Investing in the fund is like buying some from each of the companies involved. Fund managers select the best blockchain stocks and add them to their funds.
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Initial blockchain ETFs include Amplify’s Transformational Data Sharing ETF (BLOK), SRN Advisors’ Siren Nasdaq NexGen Economy ETF (BLCN), and First Trust’s Indxx Innovative Transaction & Process ETF (LEGR) is located. The size of these funds ranges from 120 million Euros to 1.5 billion Euros managed.
In contrast to these American funds, there are also ETFs traded in Europe.
In Germany, ETC Group has issued funds for Bitcoin, Ethereum, Litecoin, Bitcoin Cash, Solana, Cardano, Stellar, Polkadot and Tezos. Iconic Funds also offers a Bitcoin ETF.
In Jersey, Wisdom Tree offers funds for Bitcoin, Ethereum, crypto altcoins, crypto mega cap and crypto market. CoinShares offers funds for Bitcoin and Ethereum.
In Liechtenstein, investors can purchase ETFs associated with Bitcoin, Ethereum, Tron, Solana and Polkadot through VanEck. Iconic offers an Ethereum ETF.
21Shares from Switzerland has launched a crypto index fund alongside ETFs for Ethereum, Bitcoin, Solana, Polkadot, Cardano, Tezos, Bitcoin Cash and Stellar.
As these funds become more popular, new funds are likely to be launched in other countries as well.
Exchanges are highly regulated, and all of these funds pass their regulatory costs to investors. But for investors, they offer the answer to the question of how to invest in blockchain technology without buying crypto. Blockchain technology stocks offer the opportunity to carefully try the waters of the blockchain investment ocean.
NOTE: This text is an informational text and is not considered investment advice. It does not express the personal opinion of the author or the service. Any investment or trading is risky, past returns are no guarantee for future returns – only risk assets you can afford to lose.
