BLKC

About BLKC

TheFund generally will invest at least 80% of its total assets in the securities that comprise the Underlying Index.Strictlyin accordance with its guidelines and mandated procedures, VettaFiLLC (the “Index Provider”) maintains the Underlying Index, which is comprised of two different components: (i) stocks of companiesthat are materially engaged in the research and development of blockchain technology, cryptocurrency mining, cryptocurrency buying, orcryptocurrency enabling technologies (the “Equity Component”); and (ii) exchange-traded products (“ETPs”) andU.S.-listed privateinvestment trusts that invest at least 75% of their assets in Bitcoin (the “ETP and Trust Component”). However,the Fund will not invest directly in cryptocurrencies such as Bitcoin, or in crypto assets. The Fund also will not invest in initial coinofferings or futures contracts on cryptocurrencies.Theterm “blockchain” refers to a type of peer-to-peer distributed ledger,or decentralized database, that keeps continuously updated digital records of who owns a particular asset (e.g., cryptocurrency). Blockchainis secured using cryptography and facilitates the process of recording transactions and tracking assets in a business network. Blockchainderives its name from the way it stores transaction data — as unchangeable, digitally recorded datain packages called “blocks” that are linked together to form a chain. Blocks record and confirm the time and sequence of transactions,which are then logged into the blockchain network. Each block in the chain is cryptographically connected to the previous block in thechain, ensuring all data in the overall “blockchain” has not been tampered with. Blockchain networks can be private with restrictedmembership similar to an intranet, or public like the Internet, and are governed by rules agreed on by the network participants.Blockchaintechnology can be used in a wide variety of data sharing applications,and track intangible and digital assets and companies across business sectors without a need for a third-party record keeper, paymentsprocessor, or central clearing authority. Blockchain technology has the potential to streamline transactions, increase confidence of commercialmarket participants, and increase efficiency for various business processes, including recordkeeping, payment processing and inventorymanagement among others. “DecentralizedCommerce” refers to commerce that relies on decentralizedtechnologies such as blockchain. Therefore, “Decentralized Commerce” reflects the commercial interaction of companies at theforefront of such innovation that seek to leverage blockchain and similar technologies or platforms to increase operational efficiencyin business to business or business to consumer transactions to their competitive advantage.Cryptocurrencyassets, such as Bitcoin and Ethereum, are examples of specificapplications of public blockchains. Cryptocurrencies are digital assets designed to work as a medium of exchange that are stored electronicallyin a blockchain. They use encryption techniques to secure transactions, to control the creation of additional monetary units, and to verifythe transfer of assets. Unlike traditional currencies, decentralized virtual currencies (or cryptocurrencies) are digital assets and arenot issued or backed by any government, agency, bank, organization or single administrator. There are thousands of cryptocurrencies, themost well-known of which is Bitcoin, and while the design and maintenance of each type of cryptocurrency differs, cryptocurrencies aretypically based on the decentralized, open source protocol of a peer-to-peer computer network. The transactions of such currencies ona blockchain are verified by cryptocurrency “miners.” Crypto-mining involves using computers to solve mathematical equations.Generally, when a successful validation occurs, a miner receives rewards paid in the form of tokens. As a result, miners are incentivizedto validate transactions and to secure the network to earn rewards.TheEquity Component of the Underlying Index is primarily comprised of exchange-listedequity securities of companies that are principally or materially engaged in one of the following four business activities (each, a “BusinessSegment”): ■ CryptocurrencyMiners: Companies that mine cryptocurrency assets. ■ CryptocurrencyEnabling Technologies: Companies that (i) facilitate the buying, selling and transfer of cryptocurrency assets, (ii) provide custody forcryptocurrency assets, (iii) supply semiconductors used in cryptocurrency mining, or (iv) supply cryptocurrency mining machines. ■ CryptocurrencyBuyers: Companies that report cryptocurrency assets on their balance sheets. ■ BlockchainUsers: Operating companies that are engaged in the research and development of blockchain technologies for non-cryptocurrency-relatedpurposes. Tobe eligible for inclusion in the Equity Component of the Underlying Index,a company’s stock must be listed on an approved and globally recognized exchange and such company must have: (i) a minimum fullmarket capitalizationvalue of $50 million, (ii) a minimum free float factor of 20%, and (iii) a minimum average daily trading value (“ADTV”) forthe previous three months of $1 million. Companies may be located in the United States or in foreign jurisdictions, including in emergingmarkets, and may be represented by depositary receipts such as American depositary receipts (“ADRs”) or global depositaryreceipts (“GDRs”). Inaddition to stocks of companies engaged in the Business Segments above,the Underlying Index also includes the ETP and Trust Component which is represented by exchange-traded products and open-ended privateinvestment trusts that trade on an approved U.S. exchange (in accordance with the Index Provider's methodology) and invest at least 75%of their assets in Bitcoin (“BTC”).Tobe eligible for inclusion in the ETP and Trust Component of the UnderlyingIndex, an ETP or private investment trustmust also: (i) have a minimum full market capitalization of $1 billion ($500 million for current Underlying Index constituents), (ii)have a minimum ADTV for the previous three months of $15 million ($7.5 million for current Underlying Index constituents), and (iii) beopen-ended.Becausethe Fund will not invest directly in any cryptocurrency, it will nottrack price movements of any cryptocurrency. The Fund may, however, have indirect exposure to crypto assets by virtue of (i) its investmentsin companies that use one or more crypto assets as part of their business activities or that hold crypto assets as proprietary investmentsand (ii) its investments in the ETP and Trust Component.TheUnderlying Index is rebalanced monthly. At each rebalance, the ETP andTrust Component is allocated a 15% Underlying Index weight, and the Equity Component is allocated the remaining 85% Underlying Index weight.All of the companies in the Equity Component are weighted equally to one another.Asof December 31, 2023,the Underlying Index was comprised of 58stocks with market capitalizations ranging from $383.9million to $2.8trillion.TheFund generally employs a “full replication” methodologyin seeking to track the Underlying Index, meaning that the Fund generally invests in all of the securities comprising the UnderlyingIndex in proportion to their weightings in the UnderlyingIndex. However, due to the practical difficulties and expense of,purchasing all of the securities in the Underlying Index, the Fund mayalso utilize a sampling methodology from time to time. A “sampling” methodology means that the Fund does not purchase allthe components of the Underlying Index. Rather, the Adviser uses quantitative analysis to select a representative sample of assets thathave, in the aggregate, investment characteristics similar to the Underlying Index in terms of key risk factors, performance attributesand other characteristics. TheFund may obtain exposure to certain securities in the ETP and Trust Componentindirectly through a wholly-owned subsidiary organized under Cayman Islands law (the “Subsidiary”). The Fund’s investmentin the Subsidiary is expected to provide the Fund with exposure to such assets in accordance with the limits of the federal tax laws,which may limit the ability of investment companies like the Fund to invest directly in such investments. The Fund’s investmentin the Subsidiary may not exceed 25% of the Fund’s total assets at each quarter-end of the Fund’s fiscal year. The Subsidiaryis wholly-owned and controlled by the Fund and advised by Invesco Capital Management LLC (the “Adviser”). The Subsidiary'sinvestment objective is to seek to track the performance of a subset of the securities in the Underlying Index. The Subsidiary will followthe same general investment policies and restrictions as the Fund, except that unlike the Fund, it may invest to a greater extent in cryptocurrency-relatedinvestments. The Subsidiary’s investments also will be subject to limits on leverage imposed by the InvestmentCompany Act of 1940,as amended (the “1940 Act”).Except as noted, for purposes of this Prospectus, references to the Fund’s investment strategies and risks include those of itsSubsidiary.TheFund is “non-diversified” and therefore is not required to meet certaindiversification requirements under the 1940 Act.ConcentrationPolicy. The Fund will concentrate its investments (i.e., investmore than 25%of the value of its netassets) in securities of issuers in any one industry or group of industries only to the extent that the Underlying Index reflects a concentrationin that industry or group of industries. The Fund will not otherwise concentrate its investments in securities of issuers in any one industryor group of industries. As of October 31, 2023,the Fund had significant exposure to the information technology sector. The Fund's portfolio holdings, and the extent to which itconcentrates its investments, are likely to change over time.