An effort by investment giants including BlackRock Inc. to redefine the $4 trillion U.S. exchange-traded fund universe has the industry’s smaller players bristling.

The push to re-classify funds into four separate categories looks like a move by the biggest providers to further cement their dominance, the critics argue, and risks confusing retail investors in the ever-more complex world of passive markets.

Under proposals sent to exchanges this week by a coalition of the largest asset managers, a host of products would lose their ETF designation, becoming instead exchange-traded instruments, notes or commodities.

“They’ve decided they want to monopolize the ETF label for only uses they declare,” said Rob Nestor, president of Direxion, one of the largest issuers of leveraged and inverse ETFs, which would become ETIs if the plan succeeds. “It’s just going to sow confusion for investors and basically serve the interest of the largest providers in the space.”

The consortium pressing for the changes -- which alongside BlackRock comprises State Street Corp., Vanguard Group, Charles Schwab Corp., Fidelity Investments and Invesco Ltd. -- says the four distinct categories will boost investor awareness of the different risks.

The six firms together make up more than 90% of the U.S. ETF market, according to data compiled by Bloomberg.

The industry has come under scrutiny in recent months as the coronavirus pandemic roiled markets. Regardless, this long-standing push -- which would result in the vast bulk of funds from big issuers retaining their ETF classification -- is leaving the smaller players up in arms.

“What they’re trying to do is corner the market on the ETF brand,” said Alfred Eskandar, co-founder of Salt Financial. “It’s just the big trying to get even bigger.”