According to Cointelegraph, ARK Invest CEO Cathie Wood has voiced concerns that the White House may be underestimating the economic risks associated with U.S. President Donald Trump’s tariff policies. Wood believes that if these risks materialize, both the president and the Federal Reserve may be forced to adopt pro-growth measures. Speaking at the Digital Asset Summit in New York on March 18, Wood pointed out that U.S. Treasury Secretary Scott Bessent appears unconcerned about an impending recession. However, she expressed her worries, highlighting a significant decline in the velocity of money—a key indicator of reduced consumer and business spending that often precedes a recession.
Wood explained that an economic downturn, marked by falling GDP, could give the administration and the Federal Reserve greater flexibility to introduce tax cuts and adjust monetary policies. Investors are keeping a close eye on the Fed, anticipating an end to its quantitative tightening program. Polymarket traders strongly believe this shift could happen before May. Additionally, expectations for multiple interest rate cuts later in the year are increasing, with CME Group’s Fed Fund futures pricing in a 65% chance of lower rates by the Fed’s June 18 meeting.
ARK Invest, under Wood’s leadership, has been a major force in cryptocurrency investment. The firm, in collaboration with 21Shares, launched a spot Bitcoin (BTC) exchange-traded fund (ETF) on January 11, 2024, which has amassed over $3.9 billion in net assets, according to Yahoo Finance. Despite recent outflows from Bitcoin ETFs, the overall trend suggests investors remain committed. ARK has also partnered with Eaglebrook Advisors to offer crypto-focused portfolio solutions for wealth managers.
At the summit, Wood reaffirmed her long-term optimism about innovation, even amid recent market fluctuations. She reiterated that crypto assets continue to present a compelling investment opportunity, aligning with ARK’s core investment strategy. Beyond Bitcoin, Ethereum (ETH), and Solana (SOL), ARK has further diversified its holdings, taking advantage of positive regulatory shifts that are making the crypto market more appealing. With these policy changes, institutions are increasingly recognizing their fiduciary duty to introduce clients to cryptocurrency as a viable asset class.
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