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ARK Invest enhances ETF transparency with Chainlink integration

source-logo  cryptopolitan.com 28 February 2024 18:35, UTC

Ark Invest and 21Shares have integrated Chainlink’s Proof of Reserve platform into their ARK 21Shares Bitcoin ETF (ARKB), aiming to increase transparency for their investors. This collaboration allows for real-time verification of the ETF’s holdings, ensuring that the Bitcoin holdings accurately back its value. The integration was announced on Feb. 28, marking a step towards providing investors with more insight and security for their investments in ARKB.

Proof of Reserve mechanism powered by Chainlink

The Proof of Reserve mechanism, powered by Chainlink on the Ethereum mainnet, leverages off-chain reserves data sourced directly from Coinbase. This setup allows for on-chain reporting of the reserve information, making the underlying Bitcoin reserve and its historical data publicly accessible via Chainlink oracles. Ophelia Snyder, co-founder and president at 21Shares, stated that this move reinforces their commitment to leading in secure, transparent asset management.

ARKB’s initiative to bring holdings data onchain follows a similar transparency effort by Bitwise, another spot bitcoin ETF issuer, which disclosed its digital wallet address in January. The industry has widely applauded this trend towards transparency, with ARKB becoming the second issuer to make its holdings data accessible onchain. As of the end of the day Monday, ARKB had accumulated 33,274 Bitcoin and had assets under management above $1.8 billion, ranking third among spot bitcoin ETFs in terms of capital attracted, trailing only behind Fidelity’s Wise Origin Bitcoin Trust (FBTC) and BlackRock’s iShares Bitcoin Trust (IBIT).

The ARK 21Shares Bitcoin ETF has been among the more successful of the 10 spot bitcoin ETFs launched on January 11. The fund’s transparency efforts are viewed as setting a new standard for combining transparency and security in digital asset management. Johann Eid, Chief Business Officer at Chainlink Labs, mentioned that Chainlink Proof of Reserve enhances the security and transparency of the ARK 21Shares Bitcoin ETF, empowering institutions and market participants with confidence in engaging with onchain finance.

Since the US SEC approved several Bitcoin ETFs for trading in January, these investment vehicles have seen massive adoption and a sustained positive trajectory. Notably, ARKB is one of the top performers among the launched spot Bitcoin ETFs, holding over 33,000 units of the flagship digital asset, valued at approximately $2 billion.