ARK Invest Dumps $5.2M Worth Of Coinbase Shares; Here’s Why
ARK Coinbase Shares Hit 18-Month High
Cathie Wood’s asset management firm, ARK Invest, is one of the candidates vying for a Bitcoin exchange-traded fund (ETF) approval. The company has reportedly dumped its Coinbase shares as the stock price rises.
According to recent trade notifications, ARK offloaded 43,956 Coinbase shares from its ARK Fintech Innovation ETF. Based on data from TradingView, Coinbase’s stock traded at $119.7 per share at the time of the sale, resulting in a $5.3 million transaction.
The increase in Coinbase’s stock price coincided with recent developments in the cryptocurrency landscape. One such development was the recent legal scrutiny against Binance, the world’s leading exchange, and its former CEO, Changpeng Zhao, by the United States authorities.
The firm and its CEO’s guilty plea for money laundering and sanctions violations has sparked a positive upswing for the US-based Coinbase. This move by ARK reflects a strategic decision to capitalize on Coinbase’s stock’s upward momentum.
Moreover, selling many of its shares demonstrates a strategic approach to maximizing returns in the face of heightened market conditions.
A Positive Year For Coinbase Stock
Per TradingView, Coinbase’s stock has risen by 168% in the last year and over 220% since the start of the year. Despite this rebound, it remains roughly 70% below its all-time high of $319 set in September 2021, months after its debut in April.
Throughout 2023, ARK’s business moves involving Coinbase have been noticeable. The Cathie Wood-led firm sold 63,675 Coinbase shares from its ARK Next Generation Internet ETF in October, amassing $5.1 million in profits.
Furthermore, ARK offloaded $103 million worth of Coinbase shares in July, when the stock was trading around $90, according to data from TradingView. Also, ARK has been actively divesting from Grayscale Bitcoin Trust (GBTC) stock. Hence, its sale of shares in crypto-related companies is not limited to Coinbase alone.
The ARK Next Generation Internet ETF sold 94,624 GBTC shares for approximately $3 million on November 24. This action is consistent with previous selloffs of almost 700,000 GBTC shares in a single month.
ARK’s consistent divestment from Coinbase and GBTC shows the firm’s approach to capitalizing on market fluctuations. These sales often signal a calculated strategy in response to changes in the volatile cryptocurrency landscape.
A Strategic Move?
Meanwhile, Eric Balchunas, a Bloomberg ETF analyst, stated that ARK’s recent sales of GBTC do not indicate a lack of confidence in Bitcoin (BTC) or a lack of preparation for their upcoming spot Bitcoin ETF products, the ARK Invest, and 21Shares.
Instead, he clarified that ARK is strategically selling some assets while acquiring others to maintain its desired portfolio weightings. Balchunas shared his insights on X to dispel the rumors that ARK’s sales of its crypto assets indicate a lack of confidence in the digital asset market.
He added that ARK has been building positions in other crypto-related stocks while divesting from Coinbase and GBTC. Recently, ARK Fintech Innovation ETF (ARKF) added 252,421 shares of SoFi, a crypto-friendly banking app.
According to TradingView data, the company’s year-to-date activity shows an accumulation of 1.6 million SoFi shares worth $11 million. Meanwhile, ARK has also been amassing shares of the crypto investment app Robinhood, with its most recent purchase being $1.1 million worth of this stock.
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