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ARK Invest And Eaglebrook Advisors Announce Their Collaboration to Make ARK's Actively Managed Crypto Strategies Available to Advisors
News provided byARK Investment Management
Oct 03, 2022, 8:00 AM ET
ST. PETERSBURG, Fla., Oct. 3, 2022 /PRNewswire/ -- ARK Investment Management LLC ("ARK" or "ARK Invest"), an investment adviser focused solely on investing in disruptive innovation, is pleased to announce its collaboration with Eaglebrook Advisors ("Eaglebrook"), the leading digital asset SMA platform operated by a SEC-registered adviser. Together, ARK and Eaglebrook are making the ARK Cryptocurrency Strategy and the ARK Cryptoasset Strategy, two actively managed crypto strategies, available as separately managed accounts for the clients of registered investment advisors.
"Since our founding in 2014, ARK has researched the crypto space and has been actively engaged in crypto related equity and security investments since 2015," stated Cathie Wood, ARK's Founder, Chief Executive Officer, and Chief Investment Officer. "Through our partnership with Eaglebrook, we now can offer actively managed crypto strategies to the wealth management industry. The strategies will be separately managed accounts (SMAs) designed to meet the needs of financial advisors, wealth managers, and their clients by offering direct ownership, low minimums, and portfolio reporting integration amongst other benefits. Advisors can differentiate themselves and add to a client's diversification by adding this new asset class to their portfolios. Our partnership combines Eaglebrook's best in-class technology driven investment platform with ARK's established digital asset experience to deliver a differentiated, turnkey investment solution."
"Our mission at Eaglebrook is to provide advisors with the technology platform to confidently invest in digital assets," stated Christopher King, Founder & CEO of Eaglebrook Advisors. "Our partnership with ARK will drive this industry forward and deliver institutional access to actively managed crypto strategies to the wealth management market."
ARK's Crypto Strategies seek to capitalize on three primary revolutions by investing in tokens1 issued on public blockchains. According to ARK's research, public blockchains are powering revolutions across money, finance, and the internet.
The ARK Cryptocurrency Strategy seeks to capitalize on the monetary revolution. Untethered from traditional systems and, generally uncorrelated to the behavior of other asset classes over longer time horizons, this cryptocurrency strategy could serve as a strategic allocation in well-diversified portfolios. ARK's Cryptocurrency Strategy is an actively managed, high conviction portfolio invested primarily in bitcoin and ether, the largest cryptocurrencies by network value.
ARK's Cryptoasset Strategy seeks to capitalize on the financial and internet revolutions by actively managing what we believe are the top 10-20 coins that represent opportunities relevant to major themes identified by ARK, including Smart Contract Networks, Decentralized Finance, Web3, and Infrastructure & Scaling.* Just as the internet turned information into packets online, ARK believes public blockchains are likely to turn all assets into transactions on-chain.
"Crypto's price action in the last year suggests that the ecosystem is fundamentally stronger than investors in traditional asset management are willing to acknowledge," stated Yassine Elmandjra, ARK's Cryptoasset Analyst. "We're thrilled to be offering actively managed crypto strategies to advisors during a time when, we believe, much of the speculative behavior has died down. We believe this presents an attractive entry point for investors."
"We are thrilled to deliver Cathie and the ARK team's digital asset portfolios in an efficient manner [SMAs] to everyday investors through our platform which is designed specifically for the wealth management channel," stated Roddy Chisholm, Chief Operating Officer of Eaglebrook Advisors. "This is a game changer for the industry and yet another sign of mainstream adoption."
ARK Investment Management LLC is a federally registered investment adviser and privately held investment firm. Specializing in thematic investing in disruptive innovation, the firm is rooted in over 40 years of experience in identifying and investing in innovations that should change the way the world works. Through its open research process, ARK identifies companies that it believes are leading and benefiting from cross-sector innovations such as robotics, energy storage, genomic sequencing, artificial intelligence, and blockchain technology. ARK's investment strategies include Autonomous Technology and Robotics, Next Generation Internet, Genomic Revolution, Fintech Innovation, Space Exploration & Innovation, 3D Printing, Israel Innovative Technology, Venture Capital, and the overall ARK Disruptive Innovation Strategy. For more information about ARK, its offerings, and original research, please visit www.ark-invest.com.
Founded in 2019, Eaglebrook Advisors is a technology-centric digital asset investment platform that offers Separately Managed Accounts (SMAs) to wealth management firms and financial advisors. Eaglebrook's digital asset SMA platform allows advisors to securely access direct digital asset investments for their clients and is integrated with the advisors' existing portfolio management system and workflow. This solution allows for seamless client onboarding, investment, reporting, and holistic portfolio management of a client's digital asset investments within a compliant and unified ecosystem. Eaglebrook's investment platform offers its own advisor-driven custom digital asset SMAs, access to third-party investment manager digital asset model portfolios, and educational resources for advisors and clients. The company is backed by leading wealth management executives and financial institutions including Castle Island Ventures, Brewer Lane Ventures, and Franklin Templeton.
©2021-2026, ARK Investment Management LLC. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of ARK Investment Management LLC ("ARK").
The information provided is for informational purposes only and is subject to change without notice. This presentation does not constitute, either explicitly or implicitly, any provision of services or products by ARK, and investors should determine for themselves whether a particular investment management service is suitable for their investment needs. All statements made regarding companies, securities, cryptocurrencies or cryptoassets are strictly beliefs and points of view held by ARK, and are not endorsements by ARK of any company, security, cryptocurrency or cryptoasset or recommendations by ARK to buy, sell or hold. Historical results are not indications of future results.
Certain of the statements contained in this presentation may be statements of future expectations and other forward-looking statements that are based on ARK's current views and assumptions, and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. The matters discussed in this presentation may also involve risks and uncertainties described from time to time in ARK's filings with the U.S. Securities and Exchange Commission. ARK assumes no obligation to update any forward-looking information contained in this presentation. ARK and its clients as well as its related persons may (but do not necessarily) have financial interests in securities, issuers, cryptocurrencies or cryptoassets that are discussed. Certain information was obtained from sources that ARK believes to be reliable; however, ARK does not guarantee the accuracy or completeness of any information obtained from any third party.
Before investing you should carefully consider the strategy's investment objectives, risks, charges and expenses. Past performance does not guarantee future results. Any performance data quoted represents past performance and current returns may be lower or higher. The investment return and principal will fluctuate so that an investment when redeemed may be worth more or less than the original cost. No part of this material may be reproduced in any form, or referred to in any publication, without the express written permission of ARK Investment Management LLC (ARK).
There can be no assurance that the strategy will achieve its investment objective. This ARK separate account strategy is more volatile than broad market averages.
The principal risks of investing in the strategy include:
Disruptive Innovation Risk. Companies that ARK believes are capitalizing on disruptive innovation and developing technologies to displace older technologies or create new markets may not in fact do so. Companies that initially develop a novel technology may not be able to capitalize on the technology. Companies that develop disruptive technologies may face political or legal attacks from competitors, industry groups or local and national governments. These companies may also be exposed to risks applicable to sectors other than the disruptive innovation theme for which they are chosen, and the securities issued by these companies may underperform the securities of other companies that are primarily focused on a particular theme.
Cryptocurrency Risk. Cryptocurrency, often referred to as ''virtual currency'' or ''digital currency,'' operates as a decentralized, peer-to-peer financial exchange and value storage that is used like money. The strategy may have exposure to bitcoin and ethereum, both cryptocurrencies. The market price of bitcoin and Ethereum has been subject to extreme fluctuations. The price could fall sharply (potentially to zero) for various reasons, including, but not limited to, regulatory changes, issues impacting the respective networks, events involving entities that facilitate transactions in bitcoin and ethereum, or changes in user preferences in favor of alternative cryptocurrencies. Furthermore, events that impact one cryptocurrency may lead to a decline in the value of other cryptocurrencies, including bitcoin and ethereum. Cryptocurrency operates without central authority or banks and is not backed by any government. Cryptocurrency is also not legal tender. Federal, state or foreign governments may restrict the use and exchange of cryptocurrency, and regulation in the U.S. is still developing. Cryptocurrency exchanges may stop operating or permanently shut down due to fraud, technical glitches, hackers or malware. Cryptocurrency Tax Risk. Many significant aspects of the U.S. federal income tax treatment of investments in bitcoin and other cryptocurrencies are uncertain and still evolving.
Cryptoasset Risk. Cryptoassets are digital / virtual in their nature, and do not possess physical characteristics (eg unlike banknotes or coins). As such, they are typically transferred, stored and traded electronically. Cryptoassets are an immature asset class given the lack of standardization and constant evolution. Certain cryptoassets have exhibited a high degree of volatility, and present risks, including liquidity risk; credit risk; market risk; operational risk (including fraud and cyber risks); money laundering and terrorist financing risk; and legal and reputation risks. Cryptoasset markets are fast evolving and direct connections between cryptoassets and systemically important financial institutions and core financial markets, while growing rapidly, are limited at the present time. Nevertheless, institutional involvement in cryptoasset markets, both as investors and service providers, has grown recently, albeit from a low base. If the current trajectory of growth in scale and interconnectedness of cryptoassets to these institutions were to continue, this could have implications for global financial stability.
Decentralized Finance ("DeFi") is a fast-emerging sector, providing financial services using both unbacked cryptoassets and stablecoins. Moreover, a relatively small number of cryptoasset trading platforms aggregate multiple types of services and activities, including lending and custody. Some of these platforms operate outside of a jurisdiction's regulatory perimeter or are not in compliance with applicable laws and regulations. This presents the potential for concentration of risks and underscores the potential lack of transparency on their activities. Partly due to the emergence of DeFi, stablecoin growth has continued, despite concerns about regulatory compliance, quality and sufficiency of reserve assets, and standards of risk management and governance. At present, stablecoins are used mainly as a bridge between traditional fiat currencies and cryptoassets, which has implications for the stability and functioning of cryptoasset markets. Were a major stablecoin to fail, it is possible that liquidity within the broader cryptoasset ecosystem (including in DeFi) could become constrained, disrupting trading and potentially causing stress in those markets. This could also spill over to short-term funding markets if stablecoin reserve holdings were liquidated in a disorderly fashion.
*Glossary: Smart Contract Networks: Distributed computing networks providing the core infrastructure on which crypto-native apps are built. Decentralized Finance: Global, transparent, and interoperable financial services deployed via smart contracts. Web3: Community-owned and user-generated networks forming the next generation of internet and culture. Infrastructure & Scaling: Essential tooling and utilities required to scale crypto-networks to billions of users. Stablecoins: Cryptoassets which seek to maintain price parity to another asset, often a fiat currency like the US dollar.
1 Token: Synonymous with cryptoasset, a token is any asset issued on a public blockchain. This includes native layer one assets (i.e. bitcoin, ether), fungible smart-contract based assets (i.e. ERC-20s), and non- fungible smart contract-based assets (i.e. ERC-721 NFTs).
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