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Making a Crypto Contrarian ETF Play in ARKW | ETF Trends

Crypto winter? Try Crypto Ice Age. The fallout from the collapse of FTX has made an already austere year for crypto much worse. The news caused the Grayscale Bitcoin Trust (GBTC) to fall to a record discount, offering investors a contrarian crypto ETF game via the ARK Next Generation Internet ETF (ARKW)which took advantage of the 42% discount on Monday by adding more than 315,000 shares.

Certainly, the situation for FTX itself is cataclysmic. But bitcoin futures jumped despite the news, CME Group reports a 42% increase in open interest contracts for the flagship cryptocurrency as of November 11.

Not even the most bearish moment so far this year for crypto according to the crypto fear and greed index, which is calculated based on $BTC price action, volume, momentum, and Bitcoin’s ranking against other cryptocurrencies. While the index currently sits at 22 – ‘extreme fear’ – it had fallen as low as six at the end of June.

Cathie Wood’s ARK ETF suite emphasizes innovation, and it’s not the first time this year they’ve bought crypto exposures at a discount, with the flagship ARK Innovation ETF (ARKK) having purchased Coinbase (COIN) shares at a low point for this platform last week amid the FTX drama.

There may be other structural reasons for a contrarian approach to crypto – despite the ongoing partisan drama in Congress, US politicians from both parties and Americans themselves still see a place for crypto in the present and future of finance.

ARKW currently owns GBTC at 4.4%, having added over $2 million worth of GBTC to its portfolio. GBTC’s price rose 5.75% at press time on Tuesday despite falling 6.3% in the past five days. The ETF itself saw a performance spike, rising from -27.8% for three-month returns to 5.1% for one-month performance.

Charging 83 basis points, ARKW invests in companies that stand to benefit from advances in e-commerce, AI, mobile telephony and cloud computing. The strategy offers an attractive contrarian crypto ETF opportunity for investors looking to buy low and reverse the market low.

For more news, insights and strategy visit the Disruptive Technology Channel.

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