If You Invested in VanEck Digital Transformation ETF (DAPP)

The VanEck Digital Transformation ETF (NASDAQ: DAPP) is an exchange-traded fund designed to give investors exposure to companies involved in the rapidly evolving digital assets economy. According to multiple VanEck disclosures, the fund focuses on digital transformation companies and does not invest in digital assets (including cryptocurrencies) directly or indirectly through derivatives. Instead, it holds equity securities of businesses that are closely tied to the development and adoption of digital asset and blockchain technologies.

DAPP seeks to track, as closely as possible, the price and yield performance of the MVIS Global Digital Assets Equity Index, a rules-based, modified capitalization-weighted, float-adjusted index. This index is intended to provide a means of following the performance of companies involved in digital assets. VanEck has described DAPP as offering diversified exposure to companies at the forefront of the digital assets transformation, including digital asset exchanges, miners, infrastructure companies and other participants in the digital assets ecosystem.

Investment focus and strategy

The ETF’s investment universe is defined by its underlying index, the MVIS Global Digital Assets Equity Index. In VanEck’s descriptions, this index is built to capture the performance of companies involved in digital assets and the broader digital transformation linked to blockchain technology. DAPP uses a passive, index-tracking approach, seeking to replicate the index’s performance rather than actively selecting securities based on discretionary views.

VanEck emphasizes that DAPP will not invest in digital assets directly, will not use digital asset derivatives, and will not participate in initial coin offerings. As a result, the ETF is not expected to track the price movement of any digital asset. Instead, its performance is driven by the equity prices of digital transformation companies, which may be influenced by factors such as equity market conditions, sector dynamics, and company-specific developments.

Role within VanEck’s digital assets lineup

DAPP is part of a broader VanEck family of digital asset and digital asset-focused funds. VanEck has highlighted DAPP alongside other products such as the VanEck Digital Assets Mining ETF (DAM), the VanEck Onchain Economy ETF (NODE), and various bitcoin- and ether-related funds and trusts. Within this lineup, DAPP is described as a key means of adding passive, market-tracking exposure to pureplay companies at the forefront of the digital assets transformation.

In communications about NODE, VanEck notes that DAPP seeks to track the MVIS Global Digital Assets Equity Index and provides diversified exposure to digital asset exchanges, miners, infrastructure companies, and other leaders driving digital asset innovation. The fund has also been referenced in issuer announcements from companies such as DeFi Technologies Inc., which reported its inclusion in the MVIS Global Digital Assets Equity Index and the VanEck Digital Transformation ETF.

Risk profile and investor considerations

VanEck repeatedly characterizes an investment in DAPP as involving a substantial degree of risk and a high degree of volatility, with the possibility of significant losses. The firm notes that an investment in the fund is not a bank deposit and is not insured or guaranteed by any government agency. Key risk factors cited in VanEck disclosures include:

• Risks related to investing in digital transformation companies
• Exposure to equity securities, including small- and medium-capitalization companies
• Concentration in the information technology and financials sectors
• Risks associated with foreign securities and emerging market issuers
• Market, operational, and index tracking risks
• Risks tied to authorized participant concentration, trading issues, and fund share liquidity
• Non-diversified and concentration risks

VanEck also highlights risks specific to the digital assets ecosystem, noting that blockchain and digital asset technologies are new and developing, and that associated risks may not fully emerge until the technology is more widely used. The firm points to potential issues such as theft, loss or destruction of cryptographic keys, evolving regulatory frameworks, and the possibility that regulatory developments could affect the viability and expansion of digital assets.

Relationship to digital assets and blockchain technology

While DAPP does not hold digital assets directly, VanEck’s disclosures position the ETF in the context of the digital transformation of the global economy through the use of blockchain technology. Companies in the fund’s index universe are described as operating within the digital assets space or utilizing blockchain technologies in ways that may reshape industries and finance. VanEck has stated that it views companies developing and using blockchain technologies as a disruptive force with the potential for long-term structural growth.

In various communications, VanEck has associated DAPP with exposure to businesses such as digital asset exchanges, miners, infrastructure providers, and other key participants in digital asset economies. The fund is therefore intended for investors who seek equity-based exposure to the digital assets ecosystem rather than direct ownership of cryptocurrencies.

Issuer background

DAPP is managed by VanEck, an investment management firm founded in 1955. VanEck describes itself as one of the first U.S. asset managers to offer investors access to international markets and notes a history of identifying asset classes and trends that have influenced the investment management industry, including gold investing, emerging markets and exchange-traded funds. The firm offers both active and passive strategies across mutual funds, ETFs and institutional accounts, and emphasizes themes such as investability, liquidity, diversity and transparency in its investment processes.

Key structural characteristics

From the available disclosures, several structural features of the VanEck Digital Transformation ETF can be summarized:

• Structure: Exchange-traded fund (ETF)
• Objective: Seeks to track the price and yield performance of the MVIS Global Digital Assets Equity Index
• Exposure type: Equity securities of digital transformation companies involved in digital assets economies
• Digital asset policy: Will not invest in digital assets directly, will not use digital asset derivatives, and will not invest in initial coin offerings
• Trading venue: Referenced as NASDAQ: DAPP in issuer and third-party communications

Because the fund tracks a specific index and follows a passive approach, changes in its holdings are driven by the methodology and composition of the MVIS Global Digital Assets Equity Index rather than by discretionary security selection.

Use cases for investors

Based on VanEck’s descriptions, DAPP may be used by investors who want:

• Equity-based exposure to companies participating in digital assets economies
• A passive, index-tracking vehicle focused on digital transformation companies rather than direct cryptocurrency holdings
• Access to a concentrated theme around blockchain and digital asset-related businesses, with the understanding that this concentration may increase volatility and risk

Any decision to invest in DAPP should be based on a careful review of the fund’s prospectus, including its detailed description of investment objectives, strategies, fees and risks, as highlighted in VanEck’s disclosures.