Arca, an institutional asset manager, has received the US Securities and Exchange Commission’s (SEC) approval for the launch of a blockchain transferred fund.
Announced on Monday, the fund called Arca US Treasury Fund is an SEC-registered closed-end in nature and is already open to investors. Its digital securities as ArCoin can be traded on the top of Ethereum blockchain.
“Our announcement today is a ground-breaking and transformative step toward the unification of traditional finance with digital asset investing as this new category of regulated, digital investment products is made available to investors,” Rayne Steinberg, chief executive officer of Arca, said.
The fund is investing 80 percent of its portfolio assets in interest-bearing, short-duration, US treasury bonds and notes.
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The first registered investment fund based on blockchain
The fund manager also highlights that it is the first fund with a representation with cryptographic tokens approved under the Investment Company Act of 1940. This is the result of the effort of 20 months since when Arca was pushing some variation of the fund for approval.
Being a registered fund, it will offer daily net-asset-value reporting, bankruptcy protections, periodic audited financial statements, and assets held in a statutory trust overseen by an independent board of trustees.
The development of ArCoin was carried out by the Arca Labs. Built on the Ethereum blockchain, ArCoin follows ERC-1404 standard. The protocol might also helped Arca to gain approval as, unlike ERC-20, ERC-1404 restricts where holders can send a token to a collection of whitelisted addresses.
“The digital assets ecosystem is a rapidly growing and evolving industry. We are establishing Arca Labs at the forefront of this industry to innovate digital investment products that provide regulatory oversight and transparency, along with daily valuation, that investors look for in their traditional core investment holdings,” Jerald David, president of Arca Capital Management, added.