ARK Invest Cashes In: Sells $8.7M in Bitcoin ETF Shares for Profits
ARK Invest Sells bitcoin ETF and Coinbase Shares Amid Market Surge
Overview of Recent Transactions
ARK Invest has recently divested $8.7 million from its spot bitcoin ETF and offloaded $13.3 million in shares of Coinbase on Tuesday. This decision followed a brief spike in bitcoin‘s value, which exceeded $123,000, and a record high for Coinbase, pushing its market capitalization above $100 billion.
Strategic Moves by ARK Invest
Cathie Wood’s investment firm sold 225,742 shares of the ARK 21Shares bitcoin ETF (ARKB) from its Next Generation Internet fund (ARKW) on Tuesday, as indicated by the firm’s daily trading updates. Concurrently, they sold 34,207 shares of Coinbase Global Inc.
Analyst Nicolai Sondergaard from Nansen suggested that ARK may have aimed to take advantage of the recent market momentum while reducing its exposure ahead of the Consumer Price Index (CPI) announcement. He noted that this could also indicate a shift towards higher-risk, higher-reward investments or a preference for assets that have shown strong returns relative to their fundamentals.
Market Reactions and bitcoin Performance
The sale occurred after bitcoin reached a new all-time high of over $123,000 on Monday. However, the cryptocurrency later retreated to around $119,200 at the time of reporting, reflecting a 2.4% increase over the previous 24 hours, according to data from CoinGecko.
Coinbase shares hit a peak of $398.50 on Monday, which contributed to its market cap surpassing $100 billion. The stock briefly crossed the $400 mark on Wednesday before closing below that level.
Context of Coinbase’s Recent Sales
This latest transaction marks the second significant sale of Coinbase shares by ARK this month, as the firm previously sold $95 million worth of COIN shares across various ETFs as part of a rebalancing strategy. This included the sale of 77,956 shares from ARKK, 29,802 shares from ARKW, and 17,134 shares from ARKF.
These sales coincided with regulatory challenges facing Coinbase, including a Supreme Court decision that declined to hear the exchange’s appeal regarding IRS access to user transaction data.
Implications for ARK’s Investment Strategy
The decision to sell bitcoin ETF shares is noteworthy for ARK, a firm recognized for its aggressive stance on cryptocurrency investments. Despite the sale, ARKB remains a significant asset in the Next Generation Internet fund, holding a 7.2% weighting valued at approximately $157.2 million. The fund also has considerable bitcoin exposure through other major holdings, including Tesla and Robinhood.
On Tuesday, ARK’s bitcoin ETF experienced net outflows of $6.2 million, contrasting with the overall trend where combined spot bitcoin ETFs recorded $403.1 million in net inflows, as reported by U.K.-based asset manager Farside Investors. BlackRock’s IBIT led the inflows with $416.3 million, contributing to a nine-day total of $4.4 billion across all bitcoin ETFs.
ARK’s Rebalancing and Future Outlook
ARK’s rebalancing strategy aims to maintain diversification across its actively managed funds, with Coinbase currently being the second-largest holding in ARKW, accounting for a 7.9% weighting worth around $172.8 million. Since its launch, ARK’s bitcoin ETF has amassed $2.9 billion in cumulative net inflows and manages $5 billion in assets.
bitcoin‘s price fluctuated, dipping below $117,000 earlier on Tuesday before recovering, according to CoinGecko data. Meanwhile, Coinbase has seen a remarkable 48% increase over the past month, driven by a surge in trading volumes amid the ongoing crypto rally.
