Assets in Crypto ETFs Triple in Just Six Months, Cathie Wood’s Ark to Start Investing in Canadian Bitcoin ETFs

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.

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.

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Author: AnTy

Crypto Bull Cathie Wood’s Ark Investment and 21Shares File for A Bitcoin ETF

Cathie Wood’s Ark Investment is interested in a Bitcoin exchange-traded fund (ETF).

Ark’s total ETF assets under management are currently at $47.8 billion, up from a 2021 low of $42.6 billion at the end of last month. Wood’s firm has taken in $15.8 billion in fresh cash this year.

After buying the latest dips on Coinbase (COIN) and Grayscale Bitcoin Trust (GBTC) shares, Ark seeks to lend its name to a Bitcoin ETF.

The ETF is called “ARK 21Shares Bitcoin ETF,” which will trade under the ticker ARKB. It will be tracking the performance of the world’s largest cryptocurrency as measured by the S&P Bitcoin Index.

Lukka Inc. is the data provider and calculation agent for the Index with the current exchange composition of the Index, including Binance, Bitfinex, Bitflyer, Bittrex, Bitstamp, Coinbase Pro, Gemini, HitBTC, Huobi, Kraken, KuCoin, and Poloniex.

US-based 21Shares is an affiliate of Zug, Switzerland-based 21Shares AG, which is listed as a sponsor of the proposed ETF in the SEC filing Monday. For this, Ark Investment will be providing marketing assistance.

“This makes a lot of sense because Cathie is on the board of 21Shares, which is a big progressive crypto issuer in Europe,” said Eric Balchunas, ETF analyst for Bloomberg Intelligence.

“This gives 21Shares penetration in the U.S. and it’s on-brand for Ark given how vocal and bullish they’ve been on crypto.”

Wood joined the board of Amun Holdings, the parent company of 21Shares, in May after personally investing in the company.

Regulators, however, have yet to approve a single Bitcoin ETF in the US while several have been filed with the Securities and Exchange Commission (SEC), which recently said that it was seeking more public comment on one such proposal.

“I don’t know if it increases the chances of it getting approved, but because she does have a loyal investor following when a Bitcoin ETF does get approved, she wants to be in the race,” said Mohit Bajaj, director of ETFs at WallachBeth Capital.

Wood’s ARK Next Generation Internet ETF (ARKW) holds GBTC. Should this Bitcoin ETF get approved, Wood can swap out of GBTC to hold shares of her own ETF, Balchunas said. Grayscale itself is planning to convert its closed-ended fund into an ETF.

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Author: AnTy

“Impossible” to Shut Down: Ark Invest’s CEO Sees Emerging Market Central Banks Accumulating Bitcoin

“Impossible” to Shut Crypto Down: Ark Invest’s Cathie Wood Sees Emerging Market Central Banks Accumulating Bitcoin

She expects regulators to be “more friendly over time” while expanding her focus to include Ethereum and expects central banks to do that with BTC and other currencies.

Cathie Wood of Ark Investment shrugged any worries of harsher regulations as the cryptocurrency is “already on its way, and it’ll be impossible to shut it down.”

In fact, regulators “will be a little more friendly over time” toward cryptocurrencies out of fear of missing out (FOMO) on the innovation provided by the sector, Wood said at the Consensus 2021 conference organized by CoinDesk.

Talking about the environmental concerns, Wood said, “Half of the solution is understanding the problem.”

“This auditing of what miners, certainly in North America, are willing to do around how much of their electricity usage is generated by renewables is going to bring that topic into stark relief, and will encourage an acceleration in the adoption of renewables beyond which otherwise would have taken the place.”

This could also make the solar industry more attractive, she said. Ark doesn’t invest in solar stocks because it isn’t clear if the industry could be profitable in the next five years without subsidies, but “this dynamic might change that. So I’m actually quite excited about it,” Wood added.

Ark Investment Management published a report last month saying Bitcoin mining can drive investment in solar power and make more renewable energy available to the grid.

Expanding the Focus

During the recent sell-off that sent BTC prices crashing just over 53%, as we reported, a record amount of outflows from bitcoin funds were recorded, though it was only 0.2% of the assets under management.

Wood said the focus on green factors likely led to a pause in institutional buying of Bitcoin.

A crypto bull, Wood recently said that she is confident of her Bitcoin price prediction of $500,000.

As we reported, Ark is moving beyond Bitcoin; in the quarter of 2021, Ark bought Grayscale Ethereum Trust (ETHE) shares as well as the second-largest cryptocurrency gaining traction. She is already heavily invested in Coinabase’s COIN shares.

Ark has now hired an Ether miner on its analyst team as part of an expanding focus on cryptocurrencies, said Wood while predicting that deflation will push the value of bitcoin up by putting pressure on the currencies of emerging market countries that are commodity-dependent.

“I wouldn’t be surprised if some of these emerging market central banks start accumulating Bitcoin and other currencies because if they know their currencies are going down … they will be under attack as reserves go down.”

As for the stock market woes, concerns about higher US capital gain taxes are hurting “high-volatility, high-multiple stocks,” she said.

Wood, whose Ark Innovation ETF was the best-performing US equity fund in 2020 for her outsized bets on stocks that thrived during the pandemic, has her flagship fund down nearly 30% from its peak in early February.

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The Debate on Bitcoin’s Energy Consumption Continues

Twitter CEO Jack Dorsey, along with Cathie Wood’s Ark Invest, are working towards using Bitcoin mining to “accelerate the global energy transition to renewables.” According to CoinShares, an estimated 74% of the energy used in bitcoin mining actually comes from renewable sources.

While people argue that given the majority of Bitcoin’s hashing power comes from China, that it energy consumption is based on coal, but that’s not true because most of the Chinese miners depend on hydroelectric power; which is the cheapest power source.

Inner Mongolia, the second-largest coal producer, has shut down crypto mining, which could further push miners towards using renewable sources.

As a step towards making the world greener, the CEO of crypto exchange FTX announced the donation of $1 million to offset the blockchain resources it uses. Another exchange, BitMEX, has joined FTX in its green efforts.

Amidst the energy consumption discussion, Sam Korus, an analyst at Ark Invest, posted an update to ARK’s open-source solar, battery, and Bitcoin mining model, which now allows one to test how the system would have performed in historic Bitcoin bull and bear markets.

“The takeaway is that regardless of a Bitcoin bull or bear market, Bitcoin mining can incentivize additional solar and battery installations,” he said. “The next step is to dimension solar+battery+Bitcoin mining at the household level.”

Elon Musk also chimed in here.

As Brett Winton, Director of Research at Ark Invest, talked about Bitcoin mining being able to allow solar and battery systems to economically scale to provide a larger share of grid energy, Musk took part in this conversation by agreeing that “this can be done over time.”

However, “recent extreme energy usage growth could not possibly have been done so fast with renewables,” he added.

Musk then goes on to say how Bitcoin’s energy usage has started to exceed that of medium-sized countries, making it “almost impossible for small hashers to succeed without those massive economies of scale.”

As Bitcoiners have been pointing out, Bitcoins’ energy usage is what makes the network so secure and decentralized.

“Achieving truly decentralized finance – power to the people – is a noble & important goal. Layer count depends on projected bandwidth & compute, both rising rapidly, which means single layer network can carry all human transactions in future IMO,” said Musk. “For now, Lightning is needed.”

In a separate tweet, he continued to share his love for Dogecoin as he demonstrated a Doge dollar sticker that a Tesla supporter gave him in Berlin.

Musk further revealed that he actually owns DOGE, the sixth-largest cryptocurrency by the market of $50.3 billion, trading at $0.3574, and that he has no plans to sell any. DOGE -10.22% Dogecoin / USD DOGEUSD $ 0.36
-$0.04-10.22%
Volume 7.42 b Change -$0.04 Open $0.36 Circulating 129.69 b Market Cap 46.44 b
6 h The Debate on Bitcoin’s Energy Consumption Continues 3 d FTC Data Reveals Big Jump In Crypto Investment Scams, Losses Totaling $80M 3 d Coinbase Enables its Over A Million Wallet Users to Use DeFi — DEXs, NFTs, & More

“I haven’t & won’t sell any Doge,” said Musk.

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Author: AnTy

“We’re In A Capitulation Phase,” Says Ark Invest’s Cathie Wood; High Conviction In $500k Bitcoin Target

“We’re In A Capitulation Phase,” Says Ark Invest’s Cathie Wood; High Conviction In $500k Bitcoin Target

While she believes it is a “really great time to buy,” she doesn’t know if the bottom is in because “You never know how low is low when a market gets very emotional.”

As Bitcoin price crashed more than 50% to $30,000 from its all-time high of $65k, the market sentiments have moved into the “extreme fear” category.

But Bitcoin bull Cathie Wood, chief executive officer, and chief investment officer at Ark Investment, is unperturbed. According to her, Bitcoin is on a sale right now, reiterating her price target of $500,000 per BTC.

In an interview with Bloomberg on Wednesday, when asked if her moon target from back in April still stands, she responded in no uncertain terms, “We do. I do.”

“We go through soul searching times like this and scrape the models. And yes our conviction is as high.”

However, she didn’t rule out any deeper pullback either during a time “when a market gets very emotional.”

She pointed out how traders have been looking at a 200-day moving average and when BTC dumped below that, they also dump and run, the same as speculators. “This is as bad as it got during the Coronavirus crisis,” Wood added.

But based on all the analysis Ark has done with its crypto expert Yassine Elmandjra, all the indicators suggest that we are in the capitulation phase, which she said is a “really great time to buy,” no matter what the asset is.

“I think we’re in a capitulation phase.”

Besides Bitcoin, as we reported, Ark Invest is now also interested in Ethereum, and this week, they even bought more Coinbase shares, purchasing an additional $90 million. ETH -26.10% Ethereum / USD ETHUSD $ 2,490.54
-$650.03-26.10%
Volume 84.64 b Change -$650.03 Open $2,490.54 Circulating 115.94 m Market Cap 288.76 b
6 h “We’re In A Capitulation Phase,” Says Ark Invest’s Cathie Wood; High Conviction In $500k Bitcoin Target 7 h Tesla Has Diamond Hands Amidst “Extreme Fear,” Michael Saylor Now Owns 0.6% of BTC’s Circulating Supply 8 h Saxo Markets Launches BTC, ETH, & LTC Trading on ‘Strong Demand’

Tackling Environmental Concerns

While price-wise, nothing has changed for Bitcoin, what has changed is the environmental concerns around Bitcoin that caught the eye of Tesla CEO Elon Musk, who wants to make sure he understands this, she said.

“We believe that even this is going to change because first of all, right now the percentage of bitcoin mined with renewables and hydroelectric power is quite substantial.”

She further discussed how, in conjunction with Square, they believe that bitcoin mining can be integrated into the distribution grid, such as solar roofs, power walls in homes, and utility merchant power producers starting to include bitcoin mining in the ecosystem.

And this would happen because renewables are intermittent power sources which would mean bitcoin mining could take off.

“If there’s excess energy from solar being loaded into power walls it can be offloaded into bitcoin mining and the whole ecosystem, therefore, becomes much more economic. If this happens we believe that the adoption of solar is going to accelerate dramatically because there’s another profit center associated with it, Bitcoin mining.”

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Author: AnTy