Does cryptocurrency ETF use block-chain technology?
Is it necessary to build [Exchange Traded Funds] over block-chain technology?

No.

in case the answer is no, why?

Imagine an ETF based on stocks in gold mining companies. Those companies own open-cast mines and rock-crushing machines.
An exchange can buy and sell shares, or funds based on those shares without directly themselves operating any open-cast mines or rock-crushers.
Rock-crushing machines are not suited to keeping track of sales and purchases of stocks and shares, or of funds based on them.