ReSolve Riffs with Wes Gray and Patrick Cleary at Alpha Architect about Launching a Bitcoin Futures ETF

Wes, Patrick and the Alpha Architect Team are long-time friends of ReSolve, and were gracious enough to join us last-minute to discuss their huge win in the ETF white label space, with the launch of the ARK 21Shares Bitcoin ETF. Wes and team are known for their pure factor ETFs, but in the last few years they’ve pivoted from asset management to create an ETF Architect division, offering the “picks and shovels” for external managers to offer niche strategies with tight operations and low costs.

Wes and Patrick give us the straight goods on what it takes to launch a successful ETF, including:

• Overcoming their academic focus on factor-oriented quant strategies to entertain more diverse offerings
• How “ETF Innovation” differs from traditional approaches and fund conversions
• The “minimum effective dose” of operating capital and market buy-in necessary to facilitate a successful ETF launch
• A deep dive into the levers of economics and margins for launching and operating an ETF
• Insights on changes to tax and regulatory rules proposed by the Biden administration, and the economic merits of equalizing ETF and mutual fund tax treatment
• Evolution in market access – how investors access ETFs vs mutual funds and how to get shelf space for fund products
• The special considerations involved in launching a Bitcoin ETF
• Overcoming the negative roll yield typical of Bitcoin futures
• The state of arbitrage in the digital asset space, and why juicy returns will probably persist

You will not find a more candid, competent and credible team than Wes and Patrick to get the unfiltered version of what you need to deliver a successful ETF launch. It was also amazing to learn more about the machinations involved in standing up a crypto asset product, and getting a glimpse into the future of the space.

Thank you for watching and listening. See you next week.

This is “ReSolve’s Riffs” – live on YouTube every Friday afternoon to debate the most relevant investment topics of the day, hosted by Adam Butler, Mike Philbrick and Rodrigo Gordillo of ReSolve Global* and Richard Laterman of ReSolve Asset Management.

*ReSolve Global refers to ReSolve Asset Management SEZC (Cayman) which is registered with the Commodity Futures Trading Commission as a commodity trading advisor and commodity pool operator. This registration is administered through the National Futures Association (“NFA”). Further, ReSolve Global is a registered person with the Cayman Islands Monetary Authority.