REX Shares has launched the REX BKCM ETF (BKC US) on NYSE Arca, providing exposure to a globally diversified, actively managed portfolio of companies deriving revenue from any aspect of the blockchain ecosystem.
Brian Kelly, CEO and founder of BKCM Funds.
Blockchain is essentially a network of computers that keep transactions secure in a decentralized database, or digital ledger, similar to a shared spreadsheet, that the network can see and must approve before it can be verified and recorded.
Once recorded, no one person can change it without the agreement of others and it is nearly impossible to tamper with.
Blockchain is the technology that underpins cryptocurrencies, like bitcoin, but it has many more possible uses with the potential to move data of any kind swiftly and securely. A growing number of industries and institutions are looking to embed blockchain technology into their day-to-day processes.
Stocks in BKC’s portfolio are drawn from four main categories of blockchain-related firms: cryptocurrency miners & traders, Wall Street disruptors, decentralized internet builders, and enterprise blockchain leaders.
The fund currently has 32 holdings with the majority of the portfolio invested in US-listed stocks (51.6%), followed by equities in Japan (23.4%), Taiwan (16.0%), and South Korea (6.2%).
The fund will be managed by Brian Kelly, CEO and founder of BKCM Funds. Kelly is a leading authority on cryptocurrencies, the author of the book “The Bitcoin Big Bang”, and a regular contributor to CNBC’s “Fast Money”.
“I get asked all the time on how to invest in blockchain technology without dealing with storage, the fears of hacking, hedge funds, etc,” said Kelly. “My hope is the BKC ETF can provide this desired equity allocation to institutions and individuals alike. What excites me most, is that this opportunity may be really early on in its investment cycle.”
Greg King, CEO and founder of REX Shares, added, “Due to the dynamic nature of the global blockchain and cryptocurrency ecosystem, we wanted a skilled active manager with deep blockchain experience. Having established himself as a leading hedge fund manager, author, and thought leader in the space, we’re excited to be partnering with Brian on the BKC ETF.”
BKC has an expense ratio of 0.88%.
Interestingly, according to the fund’s prospectus, BKC may allocate a maximum of 25% of its holdings in a Cayman Islands subsidiary, a common tactic for commodity-based ETFs looking to invest in futures contracts while avoiding the cumbersome K-1 tax form.
The presence of this feature implies that BKC may at some point allocate to cryptocurrency futures, such as those tracking the price of bitcoin.