ARK Invest invests in Canadian bitcoin-ETF shares

ARK Invest invests in Canadian bitcoin-ETF shares

Asset manager ARK Invest has amended the ARK Next Generation Internet ETF (ARKW) prospectus. The entity invests in Canadian cryptocurrency-based exchange-traded funds (ETFs).

The fund may interact with digital assets, such as bitcoin, indirectly through investments in Canadian registered trusts or other co-investment vehicles like ETFs, the document said.

The company noted in the prospectus that its fund may also invest in shares of Grayscale Bitcoin Trust (GBTC). ARKW is one of the largest holders of these securities. The structure owns about 8.5 million GBTC units with a combined value of $319 million - the instrument accounts for 5.57% of its portfolio.

Bloomberg analyst Eric Balchunas suggested that ARK Invest is looking to replace GBTC shares with units of one of the Canadian ETFs. He said GBTC quotes have fallen 22% since February 2021 - over the same period, securities in a Canadian fund managed by Purpose Investments have fallen 6.46%.

That's a pretty significant spread. I'm sure it annoys them [ARK Invest], the analyst said.

According to Balchunas, Kathy Wood will hold funds in Canadian ETF units even after the SEC approves cryptocurrency-based futures funds. He explained that such instruments will not be able to outperform physically backed structures.

Recall, Bloomberg experts predicted the approval of bitcoin-ETF by the U.S. regulator by the end of October 2021.

Jack Evans

About the author

I became a crypto asset owner in 2014, when the industry was in its infancy. Before that, I was working in the classic US and European stock markets. Since then, I have gained extensive experience in both cryptocurrency investing and day trading. I am happy to share with readers my experience with crypto exchanges, DeFi and NFT instruments. 

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