Ark Investment Management Opens Door for Fund to Invest in Canadian Crypto ETFs

Ark Investment Management revised the prospectus for its ARK Next Generation Internet ETF (ARKW) to open the possibility of investing in crypto exchange-traded funds (ETFs) in Canada, according to a filing with the U.S. Securities and Exchange Commission (SEC) Friday.

• “The fund may have exposure to cryptocurrency, such as bitcoin, indirectly through an investment in a grantor trust or in other pooled investment vehicles, such as exchange-traded funds domiciled in Canada,” the investment management firm founded by crypto bull Cathie Wood wrote, replacing previous language.
• The amended document further says that the fund may invest in the Grayscale Bitcoin Trust (GBTC) or “other pooled investment vehicles that invest in bitcoin, such as exchange-traded funds that are domiciled and listed for trading in Canada (Canadian Bitcoin ETFs).” Grayscale is part of Digital Currency Group, CoinDesk’s parent company.
• In a series of tweets, Bloomberg ETF analyst Eric Balchunas speculated that Ark was looking to replace ARKW’s investment in GBTC with a Canadian ETF. ARKW holds over 8.5 million shares of GBTC, making it the second-largest holding in the fund.
• Balchunas noted that GBTC is down 22% year to date, while the Canadian ETF has dropped 6%. “That’s pretty significant dispersion,” he wrote. “I’m sure that’s irking them.”