State Street unveils crypto ETFs with partner Galaxy
The three actively managed funds target equities in the blockchain and AI realms while seeking to manage volatility
JHVEPhoto/Shutterstock modified by Blockworks
One of the world’s largest asset managers now offers crypto ETFs.
State Street Global Advisors (SSGA) has launched its Digital Asset Ecosystem ETF (DECO), Hedged Digital Asset Ecosystem ETF (HECO) and Transformative Tech Accelerators ETF (TEKX).
DECO invests in the stocks of companies “well positioned to benefit from the growing adoption of the blockchain and digital asset industries,” as well as crypto ETFs and futures contracts. HECO does the same, but seeks to manage volatility via covered call options and protective put options.
TEKX targets “companies within the value chain supporting new disruptive technologies,” including both blockchain and AI.
The launches come a couple months after SSGA revealed in June its partnership with crypto-focused Galaxy Digital, which sub-advises the three offerings. The actively managed funds carry the “SPDR Galaxy” brand.
Read more: Can State Street make up ground in the crypto ETF arena?
SSGA — with $4.4 trillion total assets under management — is behind only BlackRock and Vanguard in terms of AUM within its ETFs specifically. The company launched the first-ever US ETF — the SPDR S&P 500 ETF (SPY) — in 1993.
BlackRock currently runs the largest bitcoin fund (at $20.3 billion in assets) and an ether ETF that has notched $1 billion of net inflows since its July 23 launch. Vanguard has said it has no plans to offer crypto ETFs and does not allow clients to buy BTC funds or ETH products on its platform.
For now, SSGA is opting not to launch spot crypto ETFs. Such US-listed BTC funds have seen roughly $1.2 billion of net outflows over the last nine trading days.
Anna Paglia, SSGA’s chief business officer, said in a statement: “Some investors are not comfortable with the short-term, volatile price swings of single-currency crypto.”
She added that the company views “actively managed digital asset portfolios that help investors tap into the benefits of diversification” as the “next evolution of this market.”
The largest US ETF focused on crypto- and blockchain-related equities is the Amplify Transformational Data Sharing ETF (BLOK), which launched in 2018 and manages $627 million in assets.
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