Cathie Wood’s ARK Invest filed an updated version of its spot Bitcoin ETF, signaling its confidence in the approval of the first such product in the US. The revised filing, submitted on October 11, includes several changes from the original one, such as the addition of Fidelity as a custodian and the removal of the 5% limit on cash holdings.
The ARK 21Shares Bitcoin ETF, which would trade under the ticker ARKB, aims to track the performance of Bitcoin by investing directly in the cryptocurrency. ARK Invest believes that a spot Bitcoin ETF would offer investors more transparency, liquidity, and security than existing alternatives, such as trusts or futures-based products.
The firm also argues that a spot Bitcoin ETF would help reduce the price gap between Bitcoin and its derivatives, as well as lower the premiums and fees associated with other vehicles. ARK Invest is one of several companies that have applied for a spot Bitcoin ETF in the US, but so far none have been approved by the Securities and Exchange Commission (SEC).
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The regulator has repeatedly delayed or rejected such proposals, citing concerns over market manipulation, fraud, and custody issues. However, some analysts and industry insiders believe that the SEC may finally greenlight a spot Bitcoin ETF in the near future, as the market has matured and grown significantly in recent years. If approved, ARK Invest’s spot Bitcoin ETF could be a game-changer for both the firm and the crypto industry, as it would attract more institutional and retail investors to the space.
One of the most exciting developments in the Bitcoin ecosystem is the BitVM project, which aims to enhance Bitcoin smart contract capabilities without fork. BitVM is a virtual machine that runs on top of Bitcoin, enabling complex and expressive scripts that go beyond the limitations of the current Bitcoin Script language.
BitVM leverages the power of zero-knowledge proofs and recursive proof composition to verify the execution of smart contracts without revealing their contents or requiring a consensus change. This way, BitVM can support advanced features such as privacy, scalability, interoperability, and programmability on Bitcoin, while preserving its security and decentralization.
The cryptocurrency market has been experiencing a roller coaster ride in the past few months, with Bitcoin reaching an all-time high of over $30,000 in April, followed by a steep drop to below $23,000 in May, currently overring at $26/$27,000. One of the factors that contributed to this volatility was the hype surrounding Ordinals, a new blockchain platform that claimed to offer faster, cheaper and more scalable transactions than Bitcoin.
Ordinals, which launched its mainnet in March, attracted a lot of attention from investors, developers and enthusiasts who were looking for the next big thing in the crypto space. The platform boasted a novel consensus mechanism called Proof-of-Ordinality (PoO), which supposedly solved the scalability and security issues of Proof-of-Work (PoW) and Proof-of-Stake (PoS) systems. Ordinals also promised to support smart contracts, decentralized applications and interoperability with other blockchains.
However, the hype soon turned into disappointment, as Ordinals failed to deliver on its promises. The platform suffered from numerous technical glitches, security breaches and governance disputes that undermined its credibility and functionality. Many users reported losing their funds or being unable to access them due to faulty transactions or network congestion. Some developers and partners also abandoned the project, citing lack of transparency and communication from the Ordinals team.
As a result, the demand for Ordinals tokens plummeted, dragging down the price from over $10 in April to less than $1 in June. This also had a negative impact on Bitcoin, as many investors who had converted their BTC to Ordinals tokens rushed to sell them back for BTC or other cryptocurrencies. This increased the selling pressure on Bitcoin, contributing to its decline in value.
According to data from Blockchain.com, the number of daily confirmed Bitcoin transactions dropped from over 400,000 in April to below 200,000 in June, indicating a lower level of activity and interest in the network. The average transaction fee also decreased from over $60 in April to less than $10 in June, reflecting a lower demand for block space and faster confirmations.
While some analysts believe that this is a temporary setback for Bitcoin and that it will recover once the market stabilizes and new innovations emerge, others are more pessimistic and argue that Bitcoin is losing its relevance and appeal in the face of newer and more advanced technologies. They point out that Bitcoin’s slow transaction speed, high energy consumption and limited functionality are hindering its adoption and growth.
Cathie Wood, the founder and CEO of ARK Invest, is one of the most prominent and influential supporters of Bitcoin, having repeatedly expressed her bullish views on the digital asset. She has also invested heavily in crypto-related companies, such as Coinbase, Square, and Grayscale.