American investment management company Invesco has revealed plans to launch two cryptocurrency-focused exchange-traded funds (ETFs) as regulators have repeatedly displayed an aversive attitude towards cryptocurrencies and have called for tighter regulations.
Invesco, which has nearly $1.5 trillion of assets, stated that 85 percent of the Invesco galaxy Blockchain Economy ETF and Invesco galaxy Crypto Economy ETF will be invested in crypto-linked equity. The remainder of the portfolio will consist of trusts and futures linked to cryptocurrency.
According to the SEC filing, “The Fund will not directly invest in crypto assets or cryptocurrencies directly” The Fund could, however, be exposed to crypto assets indirectly through its investments in companies using crypto-assets or as their proprietary investments.
Invesco is the latest investment company to pursue cryptocurrency ETFs. Bloomberg Intelligence reports that at least 12 such companies, including WisdomTree Investments, Grayscale Investments, and Fidelity Investments are also pursuing a Bitcoin ETF. Bloomberg Intelligence says that the SEC has accepted at least six applications.
Gary Gensler, the new Securities and Exchange chief, had asked Congress to tighten regulations. He stated that none of the crypto exchanges have registered with the SEC. This poses a significant risk to investors and presents greater fraud and manipulation opportunities.