Ark Invest, 21Shares slated to intro crypto ETF suite next week
As industry awaits spot crypto ETF approval, the firms are set to launch five bitcoin and ether futures-based funds
愚木混株 cdd20/Unsplash modified by Blockworks
As proposed spot bitcoin and ether ETFs continue to await the green light, other types of crypto funds are set to hit the market next week.
Ark Invest and 21Shares plan to introduce five funds that hold bitcoin futures contracts, ether futures — or both — on Tuesday and Wednesday. The firms had jointly filed for these products in August.
The first bitcoin futures ETFs launched in October 2021, and ether futures funds debuted last month. Ark and 21Shares, though entering these segments late, are now set to launch actively managed iterations of these product types.
A third fund — the ARK 21Shares Active Bitcoin Ethereum Strategy ETF — would allocate to both BTC futures and ETH futures by using “historical pricing relationships and fundamental analysis to outperform holding bitcoin over a market cycle,” a company fund description says.
The companies are also set to launch an Active On-Chain Bitcoin Strategy ETF that invests in bitcoin futures and cash equivalents by relying in part on on-chain valuation models.
A fifth fund would hold BTC futures alongside a concentrated portfolio of crypto-related equities.
Read more: Ark anticipates win in US crypto ETF battle with ‘deepest’ suite, COO says
While the funds are set to join a crowded space, 21.co president Ophelia Snyder said the two firms look to differentiate by highlighting their track record that “straddles both the [traditional finance] and DeFi landscapes.”
“We are creating [products] for a wide range of investors, from crypto native to ‘crypto curious,’” Snyder added. “This robust suite of offerings allows investors to choose how they enter the space.”
But Neena Mishra, director of ETF research at Zacks Investment Research, said exact demand for such products is hard to gauge.
“I don’t expect a lot of interest in these products, especially given the timing of the launch,” she said. “Investors are eagerly waiting for spot ETFs, and the response to ether futures ETFs has been tepid.”
Ark Invest and 21Shares are among the issuers vying for a spot bitcoin ETF. The US Securities and Exchange Commission is set to rule on that proposal by Jan. 10. The firms also have a spot ether proposal in front of the regulator.
Read more: Another ether ETF launches — where do the rest stand?
Snyder argued there can be a tendency to underestimate the value and appetite for crypto offerings in a bear market.
Mishra acknowledged that flows into the ProShares Bitcoin Strategy ETF (BITO) have picked up of late, signaling investors may continue gravitating to futures-based funds to capitalize on the more recent spot ETF-fueled rally.
BITO has seen $208 million of net inflows in the last month, according to ETF.com. Net flows into crypto-related offerings have been positive for six straight weeks, CoinShares data shows — with such products bringing in $767 million over that span.
The prices of bitcoin (BTC) and ether (ETH) were up about 8% and 15% in the last week, respectively, as of 3:30 pm ET Friday.
“There are many bitcoin and ether-based products available to investors now,” Mishra said. “It remains to be seen whether these ETFs can leverage active management and proprietary trend indicators to make tactical adjustments and deliver superior performance.”
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