Ark Invest jumps into the Crypto SMA Arena

A fund group known for its investments in cutting-edge technology is set to bring its first crypto separately managed accounts (SMAs) just weeks after one of the world’s biggest asset managers went that route.

Ark Invest has partnered with digital asset SMA platform Eaglebrook Advisors to offer the strategies to clients of registered investment advisers in what Eaglebrook CEO Christopher King told Blockworks is becoming a trend.

The asset manager’s Cryptocurrency strategy primarily invests in bitcoin and ether. Ark’s Cryptoasset strategy seeks to invest in top 10 or 20 coins related to smart contract networks, DeFi and Web3, as well as infrastructure and scaling. The SMAs will be launched on 17 October.

“We have a pipeline of large asset managers, but will stagger these launches to ensure success for each asset manager launch,” King said.

“We are looking to work with any sophisticated asset manager that wants to move into the crypto space and be the technology platform to launch their products,” he said.

The upcoming launch follows Franklin Templeton’s move to offer crypto-focused SMAs for the first time. The fund giant, with roughly $1.4 trillion in assets under management, similarly teamed up with Eaglebrook to do so, and was also slated to make those offerings available to financial advisers and wealth managers by mid-October.

Roger Bayston, Franklin’s head of digital assets, told Blockworks at the time that custom SMAs are “a perfect delivery mechanism” for digital assets, adding that the wrapper is widespread in traditional finance.

Ark Invest has eight ETFs traded in the US with a total assets under management of around USD 14 billion. The fund group is one of many fund managers looking to bring a spot bitcoin ETF to market, although the SEC has yet to approve such an offering.

The company last week launched a venture fund for US investors that invests in public and private companies focused on robotics, energy storage, genomic sequencing, artificial intelligence and blockchain technology. One of the holdings is Chipper Cash, a private startup that offers a digital wallet with products such as cross-border payments, access to crypto and virtual cards.

Ark Invest crypto analyst Yassine Elmandjra said the firm believes its new crypto SMAs present an attractive entry point for investors.

“Crypto’s price action over the past year suggests that the ecosystem is fundamentally stronger than investors in traditional asset management are willing to acknowledge,” he said in a statement. “We are excited to offer actively managed crypto strategies to advisors at a time when, we believe, much of the speculative behavior has died down.”

A spokesperson for Ark Invest did not immediately return a request for comment.

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