Arca, an innovative, digital asset investment firm that blends traditional finance with cutting edge blockchain technology, today announced that the Arca U.S. Treasury Fund (the “Fund”), an SEC-registered closed-end fund, is available for investment. The Fund is the first product registered under the Investment Company Act of 1940 (“’40 Act”) to offer its shares as digital securities, called “ArCoin.” Shareholders can directly transfer ArCoin using blockchain technology, broadening the use cases within the digital ecosystem.
The Arca U.S. Treasury Fund invests 80% of its portfolio assets in interest-bearing, short-duration, U.S. Treasury securities and seeks to combine the regulatory standards applicable to an SEC-registered closed-end fund with the efficiencies of blockchain technology. Each ArCoin is a share in the Arca U.S. Treasury Fund. Accrued interest is paid directly to ArCoin holders each quarter.
ArCoin was created by Arca Labs—Arca’s innovative, digital product development division—as the first product in an upcoming portfolio of complementary ’40 Act financial products being developed for the digital marketplace. Arca Labs creates tomorrow’s digital investment products in SEC-registered structures of today.
“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,” said Rayne Steinberg, chief executive officer of Arca. “It is truly exciting to be pioneering new digital investment products through our Arca Labs division that marry best practices used in traditional finance with the many potential benefits of digital and blockchain technology—this is the next stage of development for the digital ecosystem.”
“We have seen a dramatic shift in our world from physical to digital during the last several years and an accelerated move toward digital in the last four months amid the COVID-19 pandemic,” said Jerald David, president of Arca Capital Management LLC, which oversees Arca Labs. “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. Furthermore, ArCoin offers enterprises the opportunity to manage their business operations, treasury management and payments with greater efficiency, less cost, faster settlement times and direct tracking of all transactions.”
Built on the Ethereum blockchain, ArCoin is an ERC-1404 token that provides customers digital access to sophisticated protections and transparency. The Fund is registered under the ’40 Act, providing daily net-asset-value (“NAV”) reporting, bankruptcy protections, periodic audited financial statements, and assets held in a statutory trust overseen by an independent board of trustees.
ArCoin offers digital enterprises and investors multiple use cases and widespread integration. Individuals could use ArCoin as an alternative to volatility in other digital assets, while financial institutions and digital asset enterprises could use ArCoin for clearing and settlement, lending, treasury management, and payments in industries where banking has created friction.
Investments in the Arca U.S. Treasury Fund can be made directly via the ArCoin.ArcaLabs.com website beginning today with a minimum purchase of $1,000. Shareholders are required to establish an account with the Fund’s transfer agent and must complete required know-your-customer and anti-money-laundering (“KYC/AML”) documentation, as is recognized as best practice in the digital investing industry, prior to any investment.
Arca Labs has assembled the following service providers to support the operations and oversight of the Arca U.S. Treasury Fund:
- Administrator: Ultimus Fund Solutions
- Adviser: Arca Capital Management, LLC
- Auditor: RSM US LLP
- Custodian: UMB, N.A.
- Distributor: Ceros Financial Services, Inc., Member FINRA/SIPC
- Technology Services Provider: Tokensoft
- Transfer Agent: DTAC, LLC
- Legal Counsel: Morrison & Foerster LLP