Ark Invest Jumps Into Crypto SMA Arena

Ark Invest is the latest fund manager to use the SMA wrapper as a way to offer crypto access to financial adviser clients

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Ark CEO Cathie Wood | Blockworks exclusive art by Axel Rangel

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key takeaways

  • Move comes a few weeks after Franklin Templeton offered its first crypto-focused SMAs via Eaglebrook Advisors’ platform
  • Eaglebrook CEO says firm has “a pipeline of large asset managers” looking to move into crypto space

A fund group known for its investments in cutting-edge technology is set to bring its first crypto separately managed accounts (SMAs) just weeks after one of the world’s largest asset managers went that route. 

Ark Invest has partnered with digital asset SMA platform Eaglebrook Advisors to offer the strategies to clients of registered investment advisers in what Eaglebrook CEO Christopher King told Blockworks is becoming a trend. 

The asset manager’s Cryptocurrency Strategy primarily invests in bitcoin and ether. Ark’s Cryptoasset Strategy seeks to invest in the top 10 or 20 coins related to smart contract networks, DeFi and Web3, as well as infrastructure and scaling. The SMAs are set to launch on Oct. 17.

“We have a pipeline of large asset managers, but will stagger these launches to ensure success of each asset manager launch,” King said.

“We are looking to work with any sophisticated asset manager looking to move into the crypto space and be the technology platform to launch their products,” he said.

The upcoming launch follows Franklin Templeton’s move to offer crypto-focused SMAs for the first time. The fund giant, with roughly $1.4 trillion in assets under management, similarly teamed up with Eaglebrook to do so, and was also slated to make these offerings available to financial advisers and wealth managers by mid-October.

Roger Bayston, Franklin’s head of digital assets, told Blockworks at the time that customized SMAs are “a perfect delivery mechanism” for digital assets, adding that the wrapper is prevalent in traditional finance. 

Ark Invest has eight ETFs trading in the US with combined assets under management of about $14 billion. The fund group is one of many fund managers seeking to bring a spot bitcoin ETF to market, though the SEC has not yet approved such an offering. 

The company last week launched a venture fund for US investors that invests in public and private companies focused on robotics, energy storage, genomic sequencing, artificial intelligence and blockchain technology. One of its holdings is Chipper Cash, a private startup that offers a digital wallet with products such as cross-border payments, access to crypto and virtual cards.

Ark Invest crypto analyst Yassine Elmandjra said the firm believes its new crypto SMAs present an attractive entry point for investors.

“Crypto’s price action in the last year suggests that the ecosystem is fundamentally stronger than investors in traditional asset management are willing to acknowledge,” he said in a statement. “We’re thrilled to be offering actively managed crypto strategies to advisors during a time when, we believe, much of the speculative behavior has died down.”

An Ark Invest spokesperson did not immediately return a request for comment.


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