The BlackRock ETF is yet another sign of the strength of the cryptomarket, made up of cryptocurrencies and the tokenization of assets and which goes beyond the many and profound transformations that it causes in the business and investment plans of people and companies.
It is an exchange-traded spot fund for bitcoin, the world’s largest and most important digital currency. The dynamics of a crypto ETF does not differ, in its most basic aspects, from funds linked to stock exchange indices such as BOVA11.
The only difference is in the associated asset: the appreciation indicator of a cryptocurrency.
Therefore, to invest in a bitcoin ETF, it is essential to know the main characteristics and advantages of an ETF in relation to direct investments in shares.
BLOCKBR, a company that develops tokenization infrastructure, will talk about this new feature in the market that should become a trend for the world of investments!
WHAT ARE ETFs
ETF means exchange-traded fund or in Portuguese market index investment fund and the translation already indicates what we are talking about: a type of product traded on stock exchanges in a similar way to individual shares.
ETFs in essence are investment baskets designed to track the performance of a specific index, such as the Ibovespa index in Brazil, the most famous of all, the S&P 500 in the United States and several others around the world.
They allow investors to gain diversified exposure to a wide range of financial assets such as stocks, commodities or other securities with just one transaction.
WHAT ARE THE TYPES OF ETFs?
EQUITY INCOME ETF
Also known as stock ETFs, these are funds traded on exchanges and made up of stocks that together correspond to a reference index recognized by the Securities Commission (CVM);
The best-known stock ETF is the BOVA11, which is backed by the Ibovespa index – comprising 80% of all trading volume on the exchange. To do this, the index fund uses the composition of shares that are on Ibovespa.
FIXED INCOME ETF
They are index funds traded on the exchange that reflect changes in the profitability of fixed income products – government bonds and corporate bonds.
WHAT ARE THE ADVANTAGES OF ETF
INVESTMENT DIVERSIFICATION WITH LESS RISK
Direct investment in an asset, especially cryptocurrencies, is still something that is far from the reality of most people and even many traditional investors. The ETF allows you to invest in a lower degree of exposure and starting values.
Furthermore, for innovative products such as digital currencies, ETFs are a regulated and formally supervised way of generating investments, which increases investor confidence in the legal and operational framework.
ACCESSIBILITY TO NEW MARKETS
The ETF allows access to invest in products and markets around the world and reach more specific markets that are not possible through conventional strategies. Investing in emerging markets, for example, is a possibility with exchange-trade funds.
What is the tokenization infrastructure for the financial market? Look here!
LIQUIDITY EASE OF TRADING
A great advantage of the ETF is its liquidity – the speed to transform a financial asset position into cash – without loss of value due to redemption time.
Unlike mutual funds, which can only be traded once a day, funds linked to traditional and crypto indexes enjoy the flexibility of individual stocks and can be freely traded during market hours.
COST REDUCTION
ETF management is passive – it monitors the movement of the index to which the fund is linked and does not seek to outperform through researching more assertive options and strategies. This makes the cost of administration lower.
WHAT ARE BLACKROCK ETFs
The crypto ETF is an index fund with the same operating characteristics as stock and bond ETFs, but backed by crypto assets in general. BlackRock is one of the best known investment management companies in the world and is at the forefront of this strategy.
It is famous for being a large issuer of ETFs of the most varied compositions and, therefore, has the authority that the crypto market needs for the bitcoin ETF to grant more credibility to crypto assets as investment products.
In June 2023, BlackRock filed with the SEC – equivalent to the CVM in Brazil – the application for registration of an investment fund traded on a spot bitcoin ETF exchange.
Other investment management firms have also filed orders to trade the spot bitcoin ETF – Valkyrie, ARK Invest and Fidelity
Market expectations are optimistic about approval and this financial product is expected to be a game changer for the cryptocurrency trajectory – and by extension, other digital assets.
Financial and cryptomarket experts estimate that the fund, pegged to the spot price of BTC, will reach in size 10% of the cryptocurrency’s market cap – currently at US$ 573 billion – in a period of two to three years.
BRAZIL ALREADY HAS A CRYPTOCURRENCY ETF
In Brazil there are cryptocurrency index funds that can be traded on the stock exchange, such as:
- BITH11 and QBTC11, backed by the appreciation of bitcoin;
- ETHE11 and QETH11, backed by the appreciation of ether;
- HASH11, backed by a variety of digital currencies.
These products are offered by investment managers accredited by the CVM.
INVEST AND EARN MORE WITH TOKENS ON BLOCKBR!
Buying token is not complicated if you invest with someone who makes it easy! Just open an account with a qualified asset tokenization company and create a digital wallet to store your applications.
Access our token marketplace, learn about the most varied offers and choose the ones that align with your investor profile. And you can start investing in digital assets for as little as 50 reais!
Open your account with BLOCKBR and earn more with your investments!
TOKENIZE YOUR ASSETS WITH BLOCKBR!
Tokenization is a reality that is becoming present in all segments and business models, it is not something so innovative that it should still be seen with suspicion. Companies and individuals are currently monetizing tokens.
Recent actions by BACEN and CVM signal that tokenization is legal and the digital real will be a great divider to increase the credibility of technology for those who want to invest in tokens.
Offering your business token is simpler than you might think. Do you want to see the competition come out ahead?
Come and talk to BLOCKBR.
We have the best token offering strategy on the market!
BLOCKBR Digital Assets is a fintech specialized in tokenization of assets and investments that delivers infrastructure to the regulated and non-regulated market through an All-In-One platform that offers the transformation and interoperability between assets and investors.
For more information, visit: http://www.blockbr.com.br or @blockbr_ on social networks
