Global investment manager, VanEck has launched Digital Assets Mining ETF under the ticker signal “DAM.” The latest exchange-traded fund is tailored to provide investors exposure to firms involved in the digital assets mining ecosystem.
Digital Assets Mining ETF (DAM)
According to the official document, DAM will invest at least 80% of its total assets in stocks of crypto-asset miners who earn a minimum of 50% of their revenue from mining activities or related technology or have the capacity to do so. The fund has a net expense ratio of 0.5%.
DAM aims to track “as closely as possible, before fees and expenses, the price and yield performance of the MVIS Global Digital Assets Mining Index (MVDAMTR).” For the uninitiated, the MVIS index seeks to help investors track the overall performance of the companies involved in the digital assets mining ecosystem.
The investment manager clarified that the fund will not invest in digital assets (including cryptocurrencies) directly or indirectly via digital asset derivatives.
The top ten constituents by weightage are Riot Blockchain Inc, Hut 8 Mining Corp, Marathon Digital Holdings Inc, Iris Energy Ltd, Canaan Inc, Hive Blockchain Technologies, Bitfarms Ltd/Canada, Square Inc – A, Northern Data Ag, and Silvergate Capital Corp -Cl A with 11.60%, 8.79%, 8.17%, 7.32%, 7.04%, 6.15%, 5.47%, 5.44%, 5.42%, 4.73% respectively.
VanEck Head of Product Management Ed Lopez spoke about the advantages of blockchains as opposed to traditional centralized databases processes and also highlighted the importance of miners without which transactions cannot be validated.
VanEck has been one of the most active firms with regards to filing with the United States Securities and Exchange Commission to launch a Bitcoin ETF. After several delays, the SEC had rejected VanEck’s proposal for a spot Bitcoin ETF in November last year.
VanEck’s ETF comes a month after Valkyrie’s Bitcoin Miners exchange-traded fund (ETF), “WGMI,” received approval for listing on the US stock exchange Nasdaq Stock Market.
As reported earlier, the company’s statement stated that the exchange-traded fund in question would invest a minimum of 80% of its net assets in companies that “derive at least 50% of their revenue or profits from Bitcoin mining operations and/or from providing specialized chips, hardware, and software or other services to companies engaged in bitcoin mining.” Since its debut on February 8th, WGMI slumped significantly as Bitcoin price suffered major corrections.