State Street Global Advisors, a subsidiary of State Street, the third-largest ETF issuer in the United States, has joined traditional financial institutions in exploring the growing trend of crypto ETFs.
State Street Bank said in a June 26 statement that it will partner with crypto asset investment firm Galaxy Digital to launch a new crypto ETF that will extend beyond the flagship digital asset BTC.
“By combining the strengths of two of the largest brands and first movers, we will provide investors with access to the $2.4 trillion digital asset ecosystem,” the company said.
State Street Global Advisors has filed an application with the U.S. Securities and Exchange Commission (SEC) to register SSGA Active Trust, a fund focused on Crypto assets.
As of March this year, State Street Global Advisors managed more than $4.3 trillion in assets, while Galaxy Digital managed about $6.2 billion.
According to SEC documents, SSGA will invest in various aspects of the Crypto asset market, including equity securities, futures ETFs, contracts and ETPs of Crypto asset companies.
Targeted industries include blockchain software developers, BTC miners, exchanges, and Crypto payment processors.
Meanwhile, State Street will manage the administrative and accounting responsibilities of the new digital asset ETF, while Galaxy Digital will oversee its day-to-day operations.
State Street Bank emphasized that since the debut of the spot BTC ETF, institutional and retail investors have shown growing interest in digital assets. This move is intended to provide investment options other than pure spot BTC.
Galaxy Digital CEO Mike Novogratz praised the move and foresaw broader investment opportunities in the ecosystem beyond spot BTC.
He added: “Expanding investment options beyond pure spot BTC is where we see the ecosystem moving next.”
While market observers see this as a positive step in affirming crypto assets as an asset class, ETF Store President Nate Geraci expressed surprise that State Street did not prioritize spot BTC and Ethereum ETFs given their dominance in the crypto asset market.
The BTC ETF currently manages over $50 billion in assets since its launch in January this year, attracting strong interest from the financial community.
Market experts also predict that the upcoming Ethereum ETF could attract as much as $15 billion in inflows within the first 18 months.
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