Digital asset miners are integral to the digital asset economy and represent the largest—and a fast-growing—segment of the publicly traded digital asset ecosystem
VanEck announced the launch of the VanEck Digital Assets Mining ETF (DAM), expanding the firm’s crypto and blockchain-focused investment offerings and providing investors access to companies essential to driving digital transformation.
“Blockchains introduce transparency, efficiency and lower costs compared to traditional centralized databases and processes, but without miners, blockchain transactions cannot be verified and audited, making their role absolutely essential”
DAM offers targeted exposure to digital assets mining companies, which validate and process blockchain transactions to create new units of cryptocurrency.
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“Mining is critical to the growth and functioning of digital assets. Miners secure, record and store data on the blockchain and are currently the largest segment of the publicly traded digital asset ecosystem,” said Ed Lopez, Head of Product Management at VanEck. “Though fast-growing, many of the leaders in the digital asset mining category remain in the early stages of their growth. That factor, combined with sustained, high current levels of demand for all types of digital assets, make this a compelling time for us to be launching DAM to focus specifically on digital assets miners.”
Digital assets mining companies use specialized computer chips in conjunction with software to solve complex math problems. In so doing, transactions that exist on current blocks can be verified and the miners themselves are rewarded with newly issued cryptocurrency.
“Blockchains introduce transparency, efficiency and lower costs compared to traditional centralized databases and processes, but without miners, blockchain transactions cannot be verified and audited, making their role absolutely essential,” added Lopez.
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DAM seeks to track as closely as possible the price and yield of the MVIS Digital Assets Mining Index (MVISDAM). To be eligible for inclusion in the Index, a company must generate at least 50% of its revenues from digital assets mining activities or mining-related technology or have projects that, when developed, have the potential to generate at least 50% of their revenues from digital asset mining activities or mining-related technologies. The Fund will not invest in digital assets (including cryptocurrencies) directly or indirectly through the use of digital asset derivatives.
VanEck is a clear leader in the digital assets space, both in terms of the investment solutions it has pioneered and the research it regularly shares with the marketplace. The firm recognized in 2017 that digital assets could provide a store of value alternative to existing currencies and gold, as well as technology solutions that may lower costs in the payments and financial investing industries.
DAM joins a VanEck digital assets-focused ETF lineup that also includes the VanEck Digital Transformation ETF (DAPP), which offers diversified exposure to companies at the forefront of the digital assets transformation, such as digital asset exchanges, miners, and other key infrastructure companies; and the VanEck Bitcoin Strategy ETF (XBTF), the lowest-cost Bitcoin-linked ETF1 on the U.S. market, providing actively managed exposure to Bitcoin futures.
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