According to Cointelegraph, ARK Invest CEO Cathie Wood has expressed concerns that the White House may be underestimating the recession risks posed by U.S. President Donald Trump's tariff policies. Wood believes this oversight could eventually compel both the president and the Federal Reserve to implement pro-growth strategies. Speaking at the Digital Asset Summit in New York on March 18, Wood highlighted that U.S. Treasury Secretary Scott Bessent appears unconcerned about a potential recession. However, Wood emphasized her apprehension, noting a significant slowdown in the velocity of money, which typically signals a recession as it indicates reduced spending and investment by consumers and businesses.
Wood suggested that a recession, characterized by declining GDP, might provide the president and the Federal Reserve with greater flexibility to pursue tax cuts and adjust monetary policies. Investors are closely monitoring the Federal Reserve's actions, anticipating an end to its quantitative tightening program, a move that Polymarket bettors are confident will occur before May. Additionally, expectations for multiple rate cuts by the Fed in the latter half of the year are rising, with CME Group’s Fed Fund futures prices indicating a 65% probability of lower rates by the Fed’s June 18 meeting.
ARK Invest, under Wood's leadership, has been a prominent player in the cryptocurrency investment space for years. The firm, along with 21Shares, launched a spot Bitcoin (BTC) exchange-traded fund (ETF) on January 11, 2024, which now boasts over $3.9 billion in net assets, as reported by Yahoo Finance. Despite recent heavy outflows from spot Bitcoin ETFs, the overall trend suggests investors are maintaining their positions. ARK also collaborates with Eaglebrook Advisors to offer crypto portfolio solutions to wealth managers.
During the summit, Wood reiterated her belief in long-term innovation, particularly in the face of recent market corrections. She affirmed that crypto assets remain a viable investment strategy over the long term, which is central to ARK’s investment philosophy. Wood mentioned that ARK has diversified its holdings beyond Bitcoin, Ether (ETH), and Solana (SOL), supported by favorable regulatory changes that have significantly enhanced the investment landscape. These pro-crypto policy shifts are encouraging institutions to consider crypto assets seriously, with many now recognizing a fiduciary duty to introduce clients to this emerging asset class.
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