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Ark Invest Launches Low-Fee Bitcoin ETF, Aiming Accessibility

2024.01.12

 

Key Takeaways

  •  Ark Invest debuts a low-fee bitcoin ETF to enhance investor accessibility to cryptocurrency.
  • The ETF aims to alleviate common investor concerns and barriers in the crypto space.

A Milestone for Cryptocurrency Investment

Ark Invest, under the leadership of President and COO Tom Staudt, has made a significant move in the cryptocurrency market by launching its first bitcoin exchange-traded fund (ETF). This launch follows the U.S. Securities and Exchange Commission’s recent approval of bitcoin ETFs in the U.S., which includes other major issuers like BlackRock’s iShares and Fidelity. The trading of these funds is set to commence on Thursday.

 

In an interview with CNBC’s “Street Signs Asia,” Staudt highlighted that Ark Invest’s bitcoin ETF aims to minimize friction and barriers that traditionally deterred investors from cryptocurrency investments. These barriers include issues related to custody, regulatory compliance, and cost. The Ark 21Shares Bitcoin ETF, in partnership with 21Shares, will feature a competitive fee of just 0.21%, positioning it as one of the most cost-effective options in the market.

Ark’s Vision for Crypto Investment

Ark Invest’s ETF is part of a broader trend in the industry, with several funds initially waiving fees to attract investors. The Ark 21Shares Bitcoin ETF and others like the Bitwise Bitcoin ETF and the Fidelity Wise Origin Bitcoin Trust offer an introductory fee waiver for the first six months. This strategy aims to draw a wider pool of investors who have been hesitant about the cost implications of direct crypto trading.

 

Staudt emphasized that Ark Invest does not view the ETF as a tool for maximizing profit but rather as a means to make cryptocurrency investment a “public good” accessible to all investors. He remarked on Ark’s long history of involvement in cryptocurrency since 2014, underlining their commitment to providing research and accessibility in this evolving asset class.

Bitcoin as a Unique Asset Class

Highlighting the distinctive nature of Bitcoin, Staudt pointed out its dual role as both a “risk-on and a risk-off” asset. He believes that bitcoin can function effectively in various economic scenarios, including inflation and deflation fears. Its characterization as “digital gold” further solidifies its position as a unique asset class with lower correlation to traditional financial markets.

Market Optimism and Future Projections

The SEC’s decision and the introduction of bitcoin ETFs have led to bullish sentiment among analysts, with predictions of substantial growth in bitcoin’s value. Tom Lee of Fundstrat Global Advisors projected that Bitcoin could reach as high as $150,000 in the next year and potentially $500,000 in five years. Staudt supports this optimism, highlighting the benefits of Bitcoin’s lower correlation with other asset classes and its potential to diversify investment portfolios.

 


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