Amid spot BTC ETF effort, Ark and 21Shares seek to launch other crypto funds

The two companies are sub-advisers on three bitcoin futures-related funds proposed by Empowered Funds

article-image

Rabanser/Shutterstock modified by Blockworks

share

As Ark Invest and 21Shares remain in pursuit of a spot bitcoin ETF, they’re also looking to bring three other crypto funds to market.

The new product proposals were submitted to the Securities and Exchange Commission the same day the regulator chose to delay its decision on the companies’ ETF that would hold bitcoin directly.  

Empowered Funds, a subsidiary of white-label ETF platform Alpha Architect, is listed as the investment adviser of the proposed funds. 21Shares and Ark Invest would serve as sub-advisers. 

One of the ETFs would invest in cash-settled bitcoin futures contracts traded on the Chicago Mercantile Exchange (CME), according to an Aug. 11 filing. The planned offering — to be called Ark 21Shares Active Bitcoin Futures ETF (ARKA) can also hold US Treasury securities, money market instruments and repurchase agreements. 

A second proposed fund, the Ark 21Shares Active On-Chain Bitcoin Strategy ETF (ARKC), would similarly invest at least 25% in bitcoin futures contracts, or ARKA — and the remaining assets to cash and cash equivalents.

But unlike ARKA, the so-called on-chain fund uses a proprietary trend indicator to formulate its allocation strategy by determining whether the bitcoin (BTC) market trend is bullish or bearish. Inputs to the trend indicator could include historical price data or on-chain data, the document adds. 

Finally, a proposed Ark 21Shares Digital Asset and Blockchain Strategy ETF — to trade under the ticker ARKD — would allocate to bitcoin futures contracts or ARKA, as well as the equities of companies across the blockchain, digital asset and fintech industries.

A spokesperson for Ark Invest declined to comment on the filings. 21Shares did not immediately return a request for comment. 

Ark and 21Shares linked up in 2021 to try to launch a spot bitcoin ETF. The SEC denied the companies’ proposed ETF in March 2022 and blocked a second attempt from the companies in January.

The two companies re-filed for a spot bitcoin ETF in April. The proposal came a couple months before asset management giant BlackRock entered the bitcoin ETF race in June — leading firms who had previously tried to launch such a fund to quickly re-file. 

The SEC said Friday it would “institute proceedings” to determine whether it should approve or deny the Ark 21Shares Bitcoin ETF — a type of fund the regulator has never greenlit. 

Bloomberg Intelligence analyst Eric Balchunas pointed out one of the ETF filings in a Monday tweet. Nate Geraci, president of The ETF Store, called the filing “odd,” adding that it could mean Ark Invest is “not that confident” its spot bitcoin fund will be approved.

Loading Tweet..

Many crypto ETFs are among the top-performing funds so far this year. The Valkyrie Bitcoin Miners ETF (WGMI) leads the way, with a year-to-date return of 219%, according to VettaFi’s ETF Database.   

The ProShares Bitcoin Strategy ETF (BITO) — the first and largest bitcoin futures ETF — is up 71% since the start of the year. The Global X Blockchain and Bitcoin Strategy ETF (BITS), which deploys a blended strategy similar to the proposed ARKD fund, has returned 112% so far in 2023. 

Ark and 21Shares are not the only ones on a crypto product proposal spree. Bitwise Asset Management and ProShares combined for seven ether-related ETF proposals earlier this month.

Bitwise also has an active spot bitcoin ETF filing. The SEC is set to approve, deny or say it needs more time to consider that product by Sept. 1.


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

Mon - Wed, March 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience: Attend expert-led panel discussions and fireside chats Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts.

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Research report - cover graphics (1).jpg

Research

In this report, we dive into crypto private market data to gather insights on where the future of the industry is headed. Despite a notable downturn in private raises, capital continues to infuse promising projects that aim to transform payments, banking, consumer experiences, community, and more, with 2023 being the fourth-largest year for crypto venture capital.

article-image

Revolut said that the standalone crypto exchange is currently “invite only”

article-image

The stock price jump comes after Coinbase reported ending its seven-quarter run of net losses during the fourth quarter

article-image

BUZZ holds shares of Coinbase, Robinhood and MicroStrategy

article-image

Opinion: Even though I didn’t pay for my “Diamond Hands” burger with BTC, don’t let that fool you into thinking that crypto’s development is futile

article-image

The results mark “a major positive inflection point,” one analyst says, as the exchange carries net income momentum into a crypto rally

article-image

While the slate of 10 US spot bitcoin funds have tallied $4.6 billion of net inflows thus far, half of the field is lagging the leaders