Asset management giant Ark Invest was optimistic about the positive impact of the incoming Donald Trump administration on the cryptocurrency industry in the U.S.
What Happened: In the weekly newsletter shared Monday, the Cathie Wood-led firm Ark Invest stated that Trump’s policies could provide “significant tailwinds” for the digital asset industry and bring about “much needed” clarity around regulations.
The firm saw the possibility of a more cryptocurrency-friendly SEC and the end of current Chair Gary Gensler's "regulation by enforcement” policy.
Ark Invest also highlighted the potential for the reopening of the initial public offering (IPO) window for late-stage digital asset companies like Circle and Kraken, and the passage of long-awaited digital assets legislations like the Financial Innovation and Technology for the 21st Century Act (FIT21) and the Clarity for Payment Stablecoins Act of 2023
Circle, the issuer of stablecoin USD Coin USDC/USD, confidentially filed for an IPO earlier in January. However a June report by the financial news outlet Barron's revealed the SEC’s reservations about the company’s core product, potentially impacting the listing.
As far as Kraken was concerned, the cryptocurrency exchange raised $100 million as part of a pre-IPO funding round in June, according to a Bloomberg report.
Furthermore, revoking Staff Accounting Bulletin 121 (SAB-121), a controversial SEC directive preventing banks from the custody of cryptocurrencies, which was challenged by both chambers of Congress, was deemed to be a “legislative priority.”
Why It Matters: These observations from Ark Invest come in the backdrop of Wood, the company’s founder and CEO, supporting Sen. Cynthia Lummis’ (R-Wyo.) plan to establish a U.S. strategic Bitcoin BTC/USD reserve. President-elect Trump backed setting up such a reserve during the campaign trail.
Wood is a known Bitcoin bull and in the past has projected, well, unrealistic price targets for the cryptocurrency.
She projected the top cryptocurrency to swell to a per-unit price of $3.8 million by 2030. Although not impossible, it was unlikely that Bitcoin would reach these levels in the said period.
Her firm operates the ARK 21Shares Bitcoin ETF ARKB, currently boasting of $4.44 billion in net assets, according to SoSo Value.
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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