BKCH is one of the few ETFs that target the global blockchain industry. Using a proprietary natural language processing (NLP) algorithm, the fund screens for firms involved in the following business activities: 1) Digital Asset Mining, 2) Blockchain & Digital Asset Transactions, 3) Blockchain Applications, 4) Blockchain & Digital Asset Hardware, and 5) Blockchain & Digital Asset Integration. Companies are then categorized into pure-play, pre-revenue and diversified based on revenue derived from these blockchain-related businesses. The fund typically holds a concentrated portfolio of 25 to 40 pure-play companies. If fewer than 25 pure-play companies qualify for inclusion, pre-revenue and diversified companies may be selected until the portfolio reaches 25 constituents. Holdings are market-cap-weighted, with each pure-play company capped at 12%, and any single pre-revenue and diversified firm capped at 2%. The index rebalances semi-annually.
