ARK Investments and 21 Shares Propose Bitcoin ETF as Demand Increases

The long line of firms seeking to offer a bitcoin ETF has grown just a little longer, as ARK Investments and 21 Shares have submitted a combined bid to the SEC.

The Quest for BTC ETF Continues

ARK Investment Management has applied to have a bitcoin exchange traded fund (ETF) approved by the US Securities and Exchange Commission (SEC). The product is to be called the ARK 21Shares Bitcoin ETF, and should it be approved it will lean on 21Shares’ expertise in crypto exchange-traded products (ETP). The company has solid experience in this area having previously launched a Solana ETP on the main exchange in Switzerland, the Swiss SIX.

The SEC filing

The Filing

According to the filing submitted to the SEC, 21 Shares will be the sponsor of the trust with ARK Investment Management will help to market them. ETFs offer exposure to the Bitcoin market through a type of share valued from the S&P Bitcoin Index. The index gathers data from Binance, Bitfinex, Bitflyer, Bittrex, Bitstamp, Coinbase Pro, Gemini, HitBTC, Huobi, Kraken, KuCoin and Poloniex to achieve an amalgamated price between them. In this manner investors can gain exposure to the bitcoin market without directly dealing with bitcoin itself. 

21 Shares and ARK Investment Management join a long and growing list of players seeking to offer this type of product to investors, but the SEC has always resisted any attempts to create Bitcoin ETFs in the past. Earlier this month the SEC postponed a decision on the existing ETF applications. 

As Timothy Massad, research fellow at the Kennedy School of Government at Harvard University told CNBC, “The SEC has been unwilling now for several years to approve a bitcoin ETF.”

At this time there is no indication of when the US financial regulator may change its stance on the financial product, but should they decide to do so, 21 Shares and ARK Investment will not be alone in the market. Fidelity, Grayscale Investments, WidomTree, VanEck, and NYDIG all currently have pending ETF applications.

What Next?

For a number of years the SEC has either flatly rejected Bitcoin ETFs or delayed and prevaricate. At least 14 teams have applied for an ETF with at least 6 of those later withdrawing their application or seeing it rejected. If ARK Investments and 21 Shares are to be successful in their pursuit of an ETF they may have to exercise a great deal of patience and play the waiting game.

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