VanEck has just filed with the U.S. SEC to launch its latest venture: the On-chain Economy ETF.
This fund is all about investing in companies tied to the crypto sector, without actually buying any cryptocurrencies. The S&P500 of the crypto industry?
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On-chain Economy ETF, betting on the industry, without dealing with crypto
VanEck plans to allocate at least 80% of the fund’s assets to what they call Digital Transformation Companies and Digital Asset Instruments, but what does that mean?
Well, these digital transformation companies include everything from crypto exchanges and payment gateways to mining operations and other infrastructure that supports the crypto ecosystem.
Essentially, if a company is involved in the crypto industry, it’s fair game for this ETF.
Based on the shared details, this fund won’t be investing into digital assets directly.
Instead, it will invest in financial products like commodity futures and options that give exposure to crypto without holding any coins itself.
VanEck is an established player in the crypto market
This isn’t VanEck’s first rodeo in the crypto ETF arena, as back in November, they filed for Solana ETFs and had previously applied for different crypto ETFs as well.
They did hit a bump in the road when they had to shut down their Ethereum futures ETF last September due to underperformance compared to Bitcoin ETFs.
Matthew Sigel, VanEck’s head of digital assets research, teased this new ETF on social media before deleting his post. He promised more details would be coming soon.
Deleted a post on an ETF filing.
Details coming soon— matthew sigel, recovering CFA (@matthew_sigel) January 15, 2025
When there’s gold rush, invest in shovel manufacturers?
The On-chain Economy ETF will focus on companies with significant revenue from digital asset projects or those that hold substantial crypto assets, and they’ll select these companies using a mix of fundamental analysis and market trends.
Plus, to navigate U.S. tax regulations while investing in digital asset instruments, they plan to use a subsidiary based in the Cayman Islands.
In the filing, VanEck noted that their investment in this subsidiary will generally not exceed 25% of the fund’s total assets at each quarter-end.
