In the Post-FTX World, There’s Still Enthusiasm for Crypto

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Following the collapse of crypto brokerage FTX last year, prices for already battered crypto, including bitcoin, fell as some market watchers speculated that FTX’s demise was a commentary on the broader universe of digital currencies. On that note, it looks like cooler heads have finally prevailed and while bitcoin prices have recently retreated after a strong January, excitement and optimism remain in the crypto space. If these factors increase, exchange-traded funds, such as the Invesco Alerian Galaxy Blockchain Users and Decentralized Commerce (BLKC) ETF and the Invesco Alerian Galaxy Crypto Economy (SATO) ETF.

What’s interesting about the post-FTX crypto landscape is that many professional investors, including venture capitalists, remain interested in crypto. It could take some time for this interest to translate into material benefits for assets such as BLKC and SATO, but it’s a positive sign to be sure.

A group of high profile Wall Street investors have just piled into a startup that is committed to solving a major problem in the crypto industry, Insider reported. If this sounds like a headline from 2021, you’re not mistaken. And while many of these bets exploded, the most spectacular was crypto exchange FTX which did not stop Wall Street. If there’s one thing financial firms love, it’s achieving something where others have failed miserably.

According to Invesco, SATO member companies are companies that are materially engaged in cryptocurrency, cryptocurrency mining, cryptocurrency buying, or enabling technologies. This confirms that the ETF is not only correlated to crypto prices, but could benefit from more interest and investment in the broader crypto ecosystem on behalf of professional investors.

There are some signs that the scenario is gaining momentum. Take the case of the new crypto broker C3; in theory, professional investors would be hesitant to invest in such a company after the collapse of FTX, but the reality is another story.

As April Joyner of Insider reported, some of the companies involved in C3’s $6 million round include Two Sigma Ventures, Jane Street Capital, Hudson River Trading, Flow Traders and GoldenTree Asset Management, as well as Crypto-focused subsidiaries of traditional players like Jump Crypto from Jump Trading Group and Cumberland from DRW, according to Insider.

When it comes to BLKC, the Invesco ETF offers investors an interesting mix of crypto-correlated companies and stocks of some high-quality companies outside of the direct crypto universe, including Nvidia (NASDAQ: NVDA), Meta Platforms (NASDAQ: META), and Visa (NYSE: V), among others.

For more news, insights and analysis, visit the Crypto Channel.

VettaFi LLC (VettaFi) is the index provider for BLKC and SATO, for which it receives index license fees. However, BLKC and SATO are not issued, sponsored, endorsed or sold by VettaFi, and VettaFi has no obligation or liability in connection with the issuance, administration, marketing or trading of BLKC and SATO.

Opinions and predictions expressed herein are solely those of Tom Lydon and may not materialize. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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