VIA EDGAR
January 9, 2024
Division of Corporation Finance
Office of Crypto Assets
Securities and Exchange Commission
100 F Street, N.E.
Washington, DC 20549
| Re: | Ark 21Shares Bitcoin ETF |
Amendment No. 6 to Registration Statement on Form S-1
Filed January 8, 2024
File No. 333- 257474
To Whom it May Concern:
On behalf of Ark 21Shares Bitcoin ETF (“Trust”), submitted herewith via the EDGAR system are the responses to the comments of the staff of the Office of Crypto Assets of the Division of Corporation Finance (the “Staff”) of the Securities and Exchange Commission (“SEC”) with respect to Amendment No. 6 to the Trust’s registration statement on Form S-1 filed on January 8, 2024 (“Registration Statement”). This letter is in response to the comments of the Staff of the SEC provided in correspondence dated January 8, 2024.
For your convenience, we have restated your comments below followed by our responses. Capitalized terms used but not defined in this letter have the meaning given to them in the Registration Statement. We will incorporate any changes referenced below into a future amendment to the Registration Statement.
Comment 1: Please add risk factor disclosure addressing the risks related to your Authorized Participants acting in the same capacity for several competing products.
Response: The Trust has incorporated this comment, and the following disclosure will be added:
Authorized Participants may act in the same or similar capacity for other competing products.
Authorized participants play a critical role in supporting the U.S. spot bitcoin exchange-traded product ecosystem. Currently, the number of potential Authorized Participants willing and capable of serving as Authorized Participants to the Trust or other competing products is limited. Authorized Participants may act in the same or similar capacity for other competing products, including exchange-traded products offering exposure to the spot bitcoin market or other digital assets. The Trust is therefore subject to risks associated with these competing products utilizing the same Authorized Participants to support the trading activity of the Trust and liquidity in the Trust’s Shares.
To the extent Authorized Participants exit the business or otherwise become unable to process creation and/or redemption orders and no other Authorized Participants step forward to perform these services, Shares may trade at a material discount to NAV and possibly face delisting. To the extent that exchange-traded products offering exposure to the spot bitcoin market or other digital assets utilize substantially the same Authorized Participants, this industry concentration may have the effect of magnifying the risks associated with the Authorized Participants, as operational disruptions or adverse developments impacting the Authorized Participants may be felt on an industry-wide basis, which, in turn, may adversely affect not only the Trust and the value of an investment in the Shares, but also these competing products utilizing the same Authorized Participants and, more generally, exchange-traded products offering exposure to the spot bitcoin market or other digital assets. These industry-wide adverse effects could result in a broader loss of confidence in exchange-traded products offering exposure to the spot bitcoin market or other digital assets, which could further impact the Trust and the value of an investment in the Shares.
Comment 2: In order to meet your anticipated timing, please respond to these comments and amend your registration statement no later than 10:00 a.m. (EST) on January 9, 2024.
Response: The Trust has incorporated this comment, and confirms that it will respond to these comments and amend its registration statement no later than 10:00 a.m. (EST) on January 9, 2024.
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Should members of the Staff have any questions or comments concerning this letter, please call the undersigned at 212-698-3526.
| Sincerely, |
| /s/ Allison M. Fumai |
| Allison M. Fumai, Esq. |
Dechert LLP
