Reality Shares to Launch China-based Blockchain ETF

Blockchain Investing
Blockchain Investing

The Reality Shares NASDAQ NexGen Economy China ETF will launch in June, and will have almost 40 Chinese stocks. It will be Reality Shares’ second blockchain ETF.

With China already one of the hottest spots for blockchain technology, a California-based company will be making it easier for US-based investors to put their money in that growing market by way of China-based ETF.

Reality Shares, based in San Diego, California, already has a US-based blockchain ETF called the NexGen Economy ETF (NASDAQ:BLCN) that launched in January of this year.

The ETF had accumulated over $122 million in total net assets as of Tuesday (April 24). Those assets include companies using its BLCN Blockchain Score™, which is meant to “identify companies that may benefit the most from blockchain technology.”

Now Reality Shares is building its pure-play China blockchain ETF using the same scoring methodology as BLCN to bring opportunities to US investors and obtain a partnership with a Chinese issuer.

“There’s an awful lot of companies in China that are doing really good business with blockchain,” Eric Ervin, CEO of Reality Shares, told the Investing News Network in a telephone interview.

Ervin said that with the number of China-based blockchain companies that are considered “innovators,” Reality Shares wanted to build an index specifically for China. It filed with the US Securities Exchange and Commission on April 5, and will have 75 days from that date to launch, which sets the date in June.

Ervin said that small- to mid-cap companies will make up roughly 60 percent of the ETF, which will include mostly technology, financial and consumer companies.

“In the retail and manufacturing process, there’s a big opportunity to increase margins for companies that are using blockchain,” Ervin explained.

The Blockchain Score™ methodology evaluates companies based on key factors, including: blockchain technology ecosystem; participation in industry groups; blockchain technology development; innovation; economic impact; public references; and research and development.

Ervin said investors need to be cautious when investing in Chinese companies because there’s a lot of fraud and purely speculative ventures in the market — similar to what happened when Long Blockchain (OTCMKTS:LBCC), formerly Long Island Ice Tea, was delisted from the NASDAQ earlier this month.

Still, Ervin said he is long-term bullish on the blockchain and crypto space, but acknowledged that there will continue to be some volatility. He said when it comes to investing in the space, it’s fine to speculate as long as it’s done with the right size.

“As long as you size your bets appropriately, and if they have asymmetry to the upside and less downside, that’s what makes a portfolio,” he said.

In addition to its US filing for the ETF, Reality Shares is hoping to bring the ETF to China as well. Ervin says the company is currently in talks with a number of different issuers to determine which of them will end up launching the ETF.

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Securities Disclosure: I, Jocelyn Aspa, hold no direct investment interest in any company mentioned in this article.

The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.

The Conversation (3)
Sait Uysal
Sait Uysal
03 Jan, 2018
Related to Turkey and generally for graphite, to reach the right information is really hard. Quantities related to Turkey don't represent the realities. You can check for details;
stan litvin
stan litvin
11 Apr, 2016
in Russia the figure is overstated by 45-50% percent (or get here artificial carbon and waste of metallurgical companies). At the same time Ukraine did not mention that produced and sold 13.8 thousand tons in 2015 (Flake). According to other possible true, but for investors, it would be better to separate the concept of graphite to amorphous and flake because these are two separate markets and amorphous to lithium-ion batteries do not has nothing in common.
Atanu Gupta
Atanu Gupta
08 Apr, 2016
Very good overview