Bitcoin ETF ARK Invest turns to Chainlink for additional trust

Then the American one Securities and Exchange Commission (SEC) approved the first Bitcoin (BTC) spot exchange-traded funds (ETFs) in the country, they immediately gained popularity. The politician has long had great doubts that the ETFs could be used to manipulate the market. To reassure investors and the SEC, ARK Invest and 21Shares will use Chainlink (LINK).

Chain link for additional transparency

This is what 21Shares writes in a press release. Chainlink is a so-called Oracle blockchain and enables the use of data from other locations via smart contracts. For example, you can reliably use price information for a specific purpose.

21Shares says the two companies want to use Chainlink for this because the network has proven itself as a decentralized data provider. It is said to have already processed more than $9 trillion in price information and 11.8 billion data points.

More specifically, ARK Invest and 21Shares want to use the blockchain to strengthen their “proof of reserves” – in the future it will be possible to check via Chainlink whether ARK Invest actually owns the Bitcoins that it supposedly owns. . The ability to request this information is crucial for complete transparency.

In this way, the two asset managers can prevent customers from losing trust in the fund. This happened to FTX, among others, after it emerged that it did not have all of the alleged assets. This resulted in customers withdrawing a lot of assets in a very short period of time and subsequently going bankrupt. With Chainlink, the fund can prevent such a panic.

Bitcoin ETFs extremely popular

The ARK Invest and 21Shares joint stock exchange fund was one of the approved ETFs. The various funds were already very popular on the first day after approval – three of them were even among the most popular ETFs of the entire year 2023.

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According to The Block, ARK Invest and 21Shares’ fund, ARKB, is not the most popular. Grayscale’s GBTC, BlackRock’s IBIT and Fidelity’s FBTC are much larger. The latter manages $4.6 billion at the time of writing, followed by ARKB with just under $1.6 billion.

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