ARK Invest Takes a New Step into Crypto with Index ETFs

ARK Invest, known for its bold financial strategies, is making a significant move into the cryptocurrency world. The company is proposing two innovative funds that will track the CoinDesk 20 index, a benchmark for the top 20 cryptocurrencies, including Bitcoin, Ethereum, Solana, XRP, and Cardano.

How the Funds Will Work

These funds will not hold the cryptocurrencies directly. Instead, they will use futures contracts—financial instruments that bet on the future price movements of these cryptocurrencies.

• First Fund: Tracks the CoinDesk 20 index as a whole.
• Second Fund: Tracks the index but excludes Bitcoin, balancing bets on the index with bets against Bitcoin.

Why This Matters

The goal is to provide investors with an easier way to gain exposure to a diversified portfolio of cryptocurrencies without the complexities of buying and storing them directly.

Regulatory Hurdles

These funds are planned to be listed on the NYSE Arca exchange, but the exchange has not yet taken the next steps with regulators.

Competition in the Space

ARK is not alone in this endeavor. Other firms like WisdomTree and ProShares have also proposed similar funds, but none have been approved yet. This leaves the door open for ARK to potentially be the first to offer a diversified crypto ETF.

ARK's Track Record

ARK has already made waves with its Bitcoin ETFs. With these new funds, the company is expanding its reach to cover more of the crypto market. While the strategy is promising, only time will tell if it will pay off.