Cathie Wood’s Ark Investment enters the Canadian Bitcoin ETFs market

What is Cathie Wood’s Ark Investment Management LLC?

 This financial management firm may now invest in Canadian Bitcoin ETFs as it searches for new ways to gamble on digital assets.

According to a recent supplement filing with the US Securities and Exchange Commission (SEC) (ETFs), Cathie Wood’s ARK investment management business has permitted itself to acquire Canadian Bitcoin Exchange-Traded Funds. The firm’s investment product (ARK Next Generation Internet ETF) has been updated to include Canadian Bitcoin ETFs as an investment option.

Since Ark Investment Management filed the supplement with the Securities and Exchange Commission on Friday, September 10, its fund (the US$5.7 billion ARK Next Generation Internet ETF) now has another way to acquire indirect exposure to Bitcoin investments.

The fund can now invest in other pooled investment vehicles, including ETFs registered in Canada, in addition to the Grayscale Bitcoin Trust. The ARK Next Generation Internet ETF has already made a Bitcoin investment, with roughly 5.5 percent of its assets invested in the GBTC.

The Grayscale Bitcoin Trust is one of the most straightforward ways for US investors to have access to Cryptocurrency assets through a fund, but its structure makes it inefficient. Its worth is frequently divorced from Bitcoin’s.

ARK may be aiming to obtain greater Bitcoin exposure at a lower cost, through channels with higher liquidity, and without having to pay GBTC premiums with this recent addition.

Antidolos will tell you more about this news.

Canadian Bitcoin ETFs approvals delay

Its worth frequently divorced from Bitcoin’s. Ark Investment Management’s action comes after at least 18 applications for Bitcoin-based Exchange Traded Funds (ETFs) have been filed with the US Securities and Exchange Commission (SEC).

Grayscale has been waiting for approval from the Securities and Exchange Commission to convert its well-known trust, GBTC, into an exchange-traded fund (ETF).

The United States Securities and Exchange Commission has yet to approve a physical Bitcoin ETF. And it is unlikely to do so anytime soon.

A futures-based Bitcoin ETF considered under strict limitations, according to SEC Chairman Gary Gensler. Following Gensler’s remarks, many companies applied to the Securities and Exchange Commission for futures-based Canadian Bitcoin ETFs.

This is owing to the Securities and Exchange Commission concerns. The SEC is concerned about how genuine Bitcoin ETF demand may impact the larger market, in addition to worries about fraud and volatility in the crypto sector.

Crypto ETFs Facing Hurdles

Grayscale applied for a Bitcoin ETF in 2016 but spent 2017 negotiating with the Securities and Exchange Commission. The business later withdrew its application. Claiming that the regulatory landscape for crypto assets had not progressed to the point where such goods could be allowed for sale.

However, because the regulatory landscape has altered, the crypto company is again pursuing a Bitcoin ETF.

Many cryptocurrency firms lobby the US Securities and Exchange Commission to create a Bitcoin exchange-traded fund (ETF). One of them is grayscale. Fidelity Investments, Galaxy Digital Holdings Ltd, and other companies have also submitted applications. Due to concerns about market manipulation and volatility connected with cryptocurrencies. The SEC has yet to authorize Canadian Bitcoin ETFs in the United States.

Optimism Abounds on Canadian Bitcoin ETFs

Since the historic Bitcoin bull market in 2017, speculation about a Bitcoin exchange-traded fund has been prevalent in the United States. Due to concerns about price manipulation and excessive volatility. The SEC has so far rejected all attempts to securitize Bitcoin in an ETF. Proponents of the top crypto asset, on the other hand. Think that as Bitcoin grows as an asset class, that uncertainty will fade.

VanEck Associates Corp, NYDIG Asset Management, Valkyrie Digital Assets, WisdomTree Investments, and Anthony Scaramucci’s SkyBridge Capital are the firms waiting for a Bitcoin ETF to be approved by the US Securities and Exchange Commission. Several Bitcoin ETF approvals in Canada. According to market analysts, may encourage US regulators to allow Canadian Bitcoin ETFs in the nation.

What is an ETF?

An ETF is a type of exchange-traded fund that holds a collection of securities from the same industry. An investor who holds an ETF will have access to a group of companies belonging to the same industry. Such as banking, technology, or oil. Canadian Bitcoin ETFs, give diversification to an investor’s portfolio by allowing them to invest in various assets such as stocks. Commodities, and bonds. The value of the underlying asset, whether it’s gold, Tesla, or Bitcoin, varies throughout the day. And shares of it bought and sold on the market. Bond ETFs, industry ETFs, commodity ETFs, currency ETFs, and inverse ETFs are among the many types of ETFs available.

Advantages of owning Canadian Bitcoin ETFs

A Bitcoin ETF: a hybrid of a regular exchange-traded fund and Bitcoin. When compared to holding the underlying bitcoin, buying Canadian Bitcoin ETFs has several advantages. Because cryptocurrencies are still relatively new hedges, investors may feel more at ease using ETFs. By investing in a Bitcoin ETF, investors avoid the risks associated with holding and keeping actual Bitcoin. Owning Bitcoin necessitates acquiring a Crypto wallet, dealing with a crypto exchange that can be fraught with regulatory ambiguity, and possessing private keys.

The security of Bitcoin ETF is oversee and taken care of by a trust third party. Usually a banking institution, rather than the investor himself.

Also, new trading options are available through ETFs. Such as “short-selling”. This is a practice through which the ETF borrowed on the premise that they will repurchase it in the future at a lower price. The investor bets on the price of the Bitcoin ETF dropping, borrow the security, sells it on the market, and repurchases it when the price drops.

As Bitcoin ETF is a type of security, it has clear regulations, thus avoiding issues often associated with Cryptocurrencies, such as tax concerns, regulatory uncertainty, and conforming to AML/CFTC.

Sum-up about Canadian Bitcoin ETFs

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References:
https://blockchain.news/news/cathie-wood-ark-investment…
https://www.barrons.com/articles/cathie-woods-ark-invest…
https://www.newsbreak.com/news/2369763293533/cathie-wood…