T. Rowe Price to Launch Active Crypto ETF

It will invest in a basket of crypto assets and be actively managed. T. Rowe Price (NASDAQ:TROW), the venerable asset manager that’s been around since the Great Depression, is moving rapidly into the future with the pending launch of a new actively managed crypto ETF. In a filing with the Securities and Exchange Commission (SEC), T. Rowe Price is seeking approval for the T. Rowe Price Active Crypto ETF – its first crypto-related ETF. In fact, T. Rowe Price was late to the ETF game in general, not launching their first ETFs until 2020 – almost 30 years after they debuted. The proposed T. Rowe Price Active Crypto ETF will be actively managed, like T. Rowe’s other ETFs. Its benchmark will be the FTSE Crypto US Listed Index, which tracks the performance of the top ten crypto assets based on the market capitalization. The ETF will seek to outperform the index over the long term by primarily investing in a diversified basket of commodity crypto assets. “The Shares are designed to provide investors with a means of obtaining price exposure to multiple crypto assets, as opposed to direct acquisition, holding, and trading of crypto assets on a peer-to-peer or other basis or via a crypto asset platform,” the prospectus says. The Shares are also intended to reduce the complexities and operational burdens associated with direct investment in these crypto assets, while seeking to generate returns that are higher than those of the Index.” What the ETF will invest in The filing states that the only crypto assets that the fund may hold are spot investments that meet certain eligibility criteria. Specifically, the assets must be a commodity, trade on a market that is an Intermarket Surveillance Group (ISG) member, or underlie a futures contract that has been made available to trade on a designated contract market, among other criteria. Based on that criteria, T. Rowe Price outlined several crypto assets that would be considered eligible for the fund. They include: Bitcoin (BTC) Ether (ETH) Solana (SOL), XRP (XRP), Cardano (ADA) Avalanche (AVAX), Litecoin (LTC) Polkadot (DOT) Dogecoin (DOGE) Hedera (HBAR) Bitcoin Cash (BCH) Chainlink (LINK) Lumen (XLM) Shiba Inu (SHIB) T. Rowe added that shareholders will be informed of any new eligible assets through the holding disclosures on the website. The ETF stands out for a few reasons. One, it invests in a basket of crypto assets, unlike some of the spot Bitcoin and Ether offering that invest in just a single asset. Two, it is actively managed, with the portfolio run by a team of managers, unlike a passive fund, which simply tracks an index. There was no launch date for the ETF, as the filing said it will be available “as soon as practicable after this Registration Statement becomes effective.” Complicating things a bit is the federal government shutdown. The SEC, along with other agencies, are closed, so it won’t be reviewed until after the shutdown ends.