ARK Invest and 21Shares have amended their filing for a bitcoin exchange-traded fund (ETF). Experts consider it a sign of working jointly with the U.S. SEC.
The amendment, filed on Oct. 11, provides more details on the proposed ETF, including its name, ticker symbol, fee structure, and custodian. The document now has five pages added — allegedly, following the the Securities and Exchange Commission (SEC) comments.
ETF analyst at Bloomberg Erich Balchunas calls the amendment of the ETF a sign of good progress.
Ark Invest and 21Shares ETF
According to the filing, the ETF will be called the ARK 21Shares Bitcoin ETF. It will trade under the symbol ARKB on the NYSE Arca exchange.
The ETF will charge a management fee of 0.95% per year, lower than some other bitcoin ETF applications pending before the SEC. The ETF will also use Coinbase Custody Trust Company as its custodian, holding the Bitcoin (BTC) on behalf of the fund in cold storage.
The ARK 21Shares Bitcoin ETF aims to provide exposure to the price of bitcoin by tracking the performance of the S&P Bitcoin Index, which is calculated by CF Benchmarks. The index uses prices from five bitcoin exchanges: Coinbase, Bitstamp, itBit, Kraken, and Gemini.
The ETF will not invest directly in bitcoin but will buy and sell bitcoin futures contracts and other derivatives on the Chicago Mercantile Exchange (CME) and other regulated exchanges.
The filing states that the ETF will offer investors several benefits, such as access to a regulated and transparent market for bitcoin exposure, diversification of portfolio risk, and lower costs and operational risks than holding bitcoin directly. The filing also acknowledges some risks involved in investing in the ETF, such as market volatility, regulatory uncertainty, cyberattacks, and valuation challenges.
The SEC has not yet approved any bitcoin ETFs in the U.S., despite receiving dozens of applications from various issuers. The regulator has delayed or rejected several proposals, citing concerns over market manipulation, investor protection, and lack of surveillance agreements with bitcoin exchanges. However, some analysts and industry experts are optimistic that the SEC will finally approve a bitcoin ETF this year or next year, as the crypto market matures and more institutional investors enter the space .
The ARK 21Shares Bitcoin ETF is one of the most anticipated bitcoin ETFs in the U.S., as it combines the expertise and reputation of two leading firms in the crypto and innovation sectors.
The SEC has designated December 8, 2023 as the date by which it will approve or disapprove the ARK 21Shares Bitcoin ETF. If approved, the ETF will be the first of its kind in the U.S. and will likely attract significant demand from investors who want to gain exposure to bitcoin in a convenient and regulated way.
ARK Invest is an investment management firm founded by Cathie Wood in 2014. The company focuses on investing in disruptive innovation and cutting-edge technologies. ARK Invest manages several ETFs, including its flagship fund, the Ark Innovation ETF (ARKK). This ETF has gained significant attention and popularity due to its impressive returns in recent years.
21Shares, on the other hand, is a Swiss-based investment firm that specializes in cryptocurrency exchange-traded products (ETPs). The company offers a range of ETPs that track the performance of various cryptocurrencies, including Bitcoin, Ethereum, and others. 21Shares ETF provides investors with a convenient way to gain exposure to the crypto market without directly owning the underlying assets.