Catherine Wood, Founder, CIO, and CEO at ARK Investment Management, LLC (aka “ARK” or “ARK Invest”), recently stated on micro-blogging platform X (formerly known as Twitter) that the integration of artificial intelligence (AI) and Bitcoin has the potential to dramatically alter the business landscape. Wood emphasized that this synergy could lead to significant cost reductions and productivity gains for companies.
On 21 August 2023, ARK Invest published an article (titled “Investing In Artificial Intelligence: Where Will Equity Values Surface?”), which was authored by ARK’s Client Portfolio Manager Thomas Hartmann-Boyce, CFA, Next Generation Internet Director of Research Frank Downing, and Associate Portfolio Manager Daniel White, CFA.
The article concluded:
“Investment vehicles that track broad-based indices have provided investors with easy-to-access, diversified exposures historically. In our view, the rapidly evolving AI landscape is likely to disrupt major segments of the broad-based benchmarks. AI training costs have been declining at an average rate of 70%, roughly 3x, per year …
“In our view, common benchmarks may not be capturing effectively this potential opportunity set. As such, it may be prudent to complement, hedge, or diversify core benchmark exposures by investing in alternative exposures. ARK Invest’s strategies, such as the Disruptive Innovation ETF (ARKK) and Next Generation Internet ETF (ARKW), should position investors to avoid the concentration risk associated with large benchmarks, tap into sleeper AI opportunities, and leverage the focus and agility of smaller companies. Around the corner of the benchmarks, investors have a potential opportunity to position themselves to reap gains from the growth of artificial intelligence.“
On 7 August 2023, during an interview on Bloomberg TV, Wood said:
“I think the SEC, if it’s going to approve a Bitcoin ETF, will approve more than one at once.“
She also corrected predicting that SEC would lose to Grayscale Investments:
“How can you approve a Bitcoin futures ETF and not a Bitcoin ETF? And in fact, if you’re really thinking about consumer protection, a futures ETF is swaps space, so there’s a counterparty risk there that you would not have with a Bitcoin ETF, which is backed 1:1 with Bitcoin in Coinbase’s cold storage. It still confounds me.”
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