Amplify Blockchain Technology ETF

BLOK

Market cap $1.23B

Amplify Blockchain Technology ETF (BLOK) is a long-term Buy, offering strong diversification and consistent outperformance among crypto-themed ETFs. BLOK's portfolio balances core blockchain companies with exposure to bitcoin miners, exchanges, fintech, and AI-adjacent large caps, reducing single-stock and bitcoin price risk. Compared to peers, BLOK delivers superior risk-reward, lower volatility, and thematic diversification, making it a standout choice for crypto ecosystem exposure.

Financial technology (fintech), broadly speaking, allows the remote delivery of financial services to businesses and individuals through computers or mobile devices. Fintech encompasses everything from smartphone apps to complex blockchain-enabled networks that facilitate financial transactions.

Amplify Transformational Data Sharing ETF offers concentrated exposure to blockchain and bitcoin-related companies, with top holdings like Coinbase, Robinhood, and MicroStrategy driving performance. The BLOK ETF benefits from strong liquidity and recent outperformance versus peers, but charges a relatively high fee and is not ideal for income-focused investors due to variability from period-to-period. Significant risks include high concentration in top holdings, volatility tied to bitcoin prices, and industry-specific financial reporting challenges.

Bitcoin and BLOK have shown strong performance, but August and September are typically weak months, suggesting caution in the near term. Despite seasonal risks, I maintain a buy rating on BLOK, supported by its favorable valuation, high momentum, and constructive technical chart. BLOK offers diversification across growth, value, size, and geography, with a reasonable P/E and attractive PEG ratio, though it remains a high-risk, concentrated ETF.

A new era of regulation is bound to bring high hopes for the crypto bulls. House Republicans are now gearing up for “Crypto Week” — during which the committee has agreed to prioritize digital asset legislation and review several crypto-related bills.

Thematic ETFs might have fallen somewhat out of favor in the era of nonstop megacap growth, but as that era comes to a close, investors should explore their options. As thematics become more relevant, identifying the themes that will shape the future is critical.

BLOK ETF is highly exposed to crypto, with 43% of its portfolio tied to crypto-related assets, making it a bet on risk-on market sentiment. Economic indicators show cracks, with declining nonfarm employment growth and disappointing consumer and producer sentiment indices raising concerns about the broader market stability. GDP developments were also not great, and we have outstanding concerns around reinflation, so some sort of stagflation is in the discussion.

Cryptocurrencies can be a wild ride. But many patient investors have made a killing by sticking around for the long term.

The Amplify Transformational Data Sharing ETF has potential upside due to regulatory shifts favoring innovation, with a target price of $59. New SEC guidance and blockchain adoption in government and finance could boost institutional involvement and demand for digital assets. BLOK's diversified holdings in blockchain applications, crypto custody, and tokenization offer exposure beyond Bitcoin, mitigating concentration risks.

The meteoric surge in the price of Bitcoin in recent years has fueled mainstream acceptance of cryptocurrencies as a legitimate investment class. At the same time, a quieter revolution is unfolding around the potential of crypto's underlying blockchain technology, which promises to transform how information is shared through more transparent, efficient, and secure networks.