T. Rowe Price, a legacy asset management firm, has proposed the launch of the first actively managed exchange-traded fund focused on digital assets. The T. Rowe Price Active Crypto ETF would hold a diversified basket of five to fifteen cryptocurrencies, unlike most existing funds that track single assets like bitcoin. This move comes amid growing investor interest in crypto following the successful rollout of spot bitcoin ETFs in early 2024.
The T. Rowe Price Active Crypto ETF aims to diversify beyond single-asset investments by including cryptocurrencies such as ether, Solana, XRP, and Cardano. To ensure liquidity, the fund will also allocate portions to cash, stablecoins, or U.S. Treasury bills. Unlike passive crypto ETFs from firms like BlackRock and Fidelity, which track a single asset or index, this fund would actively adjust positions based on market conditions, requiring ongoing analysis and management.
T. Rowe Price, known for active management over decades, entered the ETF space in 2020 with its first such product. The firm highlighted substantial traditional investor interest in digital assets in a paper published earlier this year. “The highly successful launch of several spot bitcoin exchange‑traded funds (ETFs) in early 2024 has shown that traditional investor interest in [digital assets] is substantial,” the company noted. It further questioned: “For us, the key question is whether the investment returns potentially available to passive DA holders merit their inclusion in diversified portfolios.”
The proposed ETF positions active management as the optimal approach for incorporating crypto into diversified portfolios. Meanwhile, firms like Grayscale have sought SEC approval for multi-crypto index ETFs, but T. Rowe Price's offering would involve more dynamic trading.
Regulatory hurdles remain. The SEC recently approved new listing standards that could expedite crypto ETF launches, with nearly 100 applications pending. However, processing is paused due to the U.S. government shutdown, delaying reviews until operations resume. This could allow the product to reach the market relatively quickly once approvals proceed.