One of the earliest exchange-traded funds, which had invested substantially in cryptocurrencies like BTC several years ago, has divested a substantial part of its BTC holdings, citing regulatory as well as tax concerns, CNBC reported. ARK Innovation ETF (ARKK) had won the "ETF of the Year" award by ETF.com in December 2017, largely due to its BTC allocation that ranged between 6-10%, according to FactSet. When BTC prices were flying through the roof in late 2017, Ark Investment Management CEO Catherine Wood had reportedly stated that the cryptocurrency was a much bigger idea than Apple. The ARK fund could not directly own BTC so it had purchased shares in Grayscale Investment’s Bitcoin Investment Trust (GBTC) in 2015 when the price of the virtual currency was just below the $250 mark. ARKK also offered an internet-focused fund called ARK Web x.0 ETF. The fund had an exceptional performance last year based on the meteoric rise in BTC’s price with both funds gaining 87% in 2017, while the GBTC fund jumped an almost incredible 1550% across the same period. However, after the disastrous fall in the crypto price earlier this year, Ark began to reduce its exposure to BTC with ARKK holding just 0.5% in BTC and ARKW holding 0.6%. According to the company, the scaling back in BTC funds is due to regulatory and tax concerns; however, the fall in price has undoubtedly had some effect in this decision. BTC’s performance was pretty dismal with GBTC indicators demonstrating that it was down 37% in 2018 and 63% from its all time high. The Ark funds are up by around 15% on a year to date basis, but the company might have profited from BTC in January 2018 when it could have sold its BTC holdings and repurchased them at a lower price. It could then have profited substantially if BTC rebounds as is expected in the latter half of the year. This liquidation by Ark now makes it much more difficult for those investors who wish to gain exposure to BTC through traditional financial instruments. Bitcoin ETFs are currently waiting for approval by the U.S. Securities and Exchange Commission. GBTC is currently the closest product to a BTC ETF at present. Contrary to most companies that have applied for Bitcoin ETFs, the fund holds BTC directly. However there has been much discussion on the fund’s value to investors since it always trades at a premium to the BTC price.