State Street collaborates with Galaxy exploring new ETF opportunities beyond Bitcoin

Asset manager State Street Global Advisors has formed a partnership with crypto investment firm Galaxy Digital to introduce innovative exchange-traded funds (ETFs) that offer exposure to digital assets. The two firms have indicated that these ETFs will go beyond the scope of spot Bitcoin ETFs. State Street, with its $4.1 trillion assets under management, stated in a press release on June 26 that there has been a surge in institutional and retail interest in digital assets since the introduction of spot Bitcoin ETFs. However, investors are now seeking investment options that extend beyond pure spot Bitcoin. To cater to this demand, State Street has proposed the SPDR Galaxy Digital Asset Ecosystem ETF, which, if approved by the United States Securities and Exchange Commission (SEC), would invest in publicly traded digital asset companies. This could include crypto exchanges, mining firms, hardware wallet service providers, and crypto-focused venture capital firms in the US and abroad. The ETF would also seek to invest in futures and spot ETF products. State Street has also proposed two other ETFs, the SPDR Galaxy Emerging Technology Enablers ETF and the Hedged Digital Asset Ecosystem ETF, to the SEC. State Street Bank and Trust is expected to provide administrative and accounting services for the digital asset ETFs developed by SSGA and Galaxy Digital. State Street entered the digital asset space in June 2021 with the launch of a dedicated digital asset division. While its competitors have already introduced spot Bitcoin ETFs in the US, which have attracted over $14.4 billion in flows in just over five months, State Street has not yet applied for such ETFs. The partnership between State Street and Galaxy Digital is seen as another indicator of the increasing acceptance of cryptocurrencies as a mainstream asset class.