Assets in Crypto ETFs Triple in Just Six Months, Cathie Wood’s Ark to Start Investing in Canadian Bitcoin ETFs
Bitcoin bull Cathie Wood’s Ark Investment Management is allowing one of its funds to invest in Canadian Bitcoin ETFs.
For this, the firm tweaked the prospectus for its $5.7 billion ARK Next Generation Internet ETF (ARKW).
This modification was made in a late-Friday filing that included that it may invest in “other pooled investment vehicles that invest in bitcoin (CRYPTO: BTC), such as exchange-traded funds that are domiciled and listed for trading in Canada (Canadian Bitcoin ETFs).”
A similar move was made by the $1.3 billion Amplify Transformational Data Sharing ETF (BLOK), a blockchain-focused product that showed a tiny stake in three Canadian Bitcoin ETFs.
SEC policy is causing capital flight from the US to Canada. https://t.co/b9lExbuBZ6
— Jake Chervinsky (@jchervinsky) September 10, 2021
Ark investment isn’t new to Bitcoin exposure, however, as ARKW has 5.5% of its fund invested in the Grayscale Bitcoin Trust, the second-largest holding in the fund.
Ark Invest owns more than 8.5 million shares of GBTC, which is currently trading at a discount of 14.58%.
Interestingly, the shares of this $30 billion vehicle have been trading at a discount ever since the first Canadian Bitcoin ETF, Purpose Bitcoin ETF (BTCC), was launched in February. GBTC is now aiming to convert its closed-ended trust into an ETF and has been making a lot of hires for the same.
The US ETF market is $6.8 trillion, more than 90% of which is controlled by BlackRock, State Street, Vanguard, Charles Schwab, Fidelity Investments, Invesco, and investors and issuers are eagerly awaiting the approval of a cryptocurrency ETF to invest in.
But the US Securities and Exchange Commission (SEC) has yet to approve a single Bitcoin ETF though the first such application was filed by Winklevoss twins in 2013. Ark itself has filed for a Bitcoin ETF by teaming up with Switzerland-based 21Shares AG.
SEC Chair Gary Gensler recently did signal openness to a futures-backed ETF.
Canada, meanwhile, has approved and listed several ETFs for both Bitcoin and Ether on Toronto Stock Exchange (TSX).
Total assets in the cryptocurrency ETFs globally have actually tripled to $9 bln as of June from $3 bln at the end of last year, according to data from ETFGI, a consultancy. The sums committed to leveraged and inverse ETFs, which amplifies gains, meanwhile has risen to a record $109 bln from $79 bln at the end of 2019.