ARK Invest Acquires $8.4M Worth of Coinbase Shares after One Month of Dormancy
Cathie Wood’s ARK Invest has added more (NASDAQ: COIN) shares to its investment portfolio. The top asset management firm purchased 53,708 Coinbase shares, worth $8.4 million, on September 11, 2024. Markedly, this comes amid a broader crypto market downturn. The acquisition was made across three of its Exchange-traded Funds (ETFs). It underscores the role of Ark Invest as one of the biggest backers of the trading platform.
Cathie Wood’s Firm Resurfaces After Brief Hiatus
In its filing, ARK Invest revealed that it purchased 38,475 shares, equivalent to $6 million, for its Innovation ETF (ARKK). Another 9,349 COIN
shares worth $1.5 million were added to its Next Generation Internet ETF (ARKW). Finally, 5,884 shares, valued at $925,000, went into its Fintech Innovation ETF (ARKF).
Since early August, when the asset manager made a huge COIN purchase of $21.8 million, this is the first time that it has initiated any other transaction related to the shares. The crypto market faced an intense selloff when ARK Invest made that massive acquisition. On August 5, the Cathie Wood firm bought 28,632 COIN shares.
As the basic measure of market performance, Bitcoin
traded below $50,000 when Ark Invest made the purchase. Unfortunately, it cleared most of the flagship cryptocurrency’s gain in the past few months. Since then, BTC has seen some price recovery despite not performing as analysts expect.
BTC is currently trading at $58,009.07, up 2.4% in the last 24 hours.
ARK Invest Pursues Diversification Within Its Funds
Since this year began, ARK Invest has initiated multiple offloads of COIN shares. Right before it presented ìs Q2 earnings reports, the company worth $2.7 million. Ark Invest’s Next Generation Internet ETF (ARKW) diluted the equity in this particular sell-off. However, this was nothing compared to the offloads that preceded it.
In the first week of March, ARK Invest decided to offload 217,305 COIN shares from its ARKK fund, which . About three weeks into the same month, ARK Invest divested 199,526 Coinbase shares: 133,533 from ARKK, 59,215 from ARKW, and 6,778 from ARKF. The offloads from ARKK were valued at approximately $35 million based on the shares’ closing price of $262 on March 21.
The total proceeds from the sale amounted to $52.3 million at the closing price on March 21. These transactions, whether offloads or purchases are part of ARK Invest’s investment strategy. This strategy involves not letting any individual holding take up more than 10% of an ETF’s portfolio. The firm is focused on rebalancing its asset weightings and ensuring diversification within its funds.
With its latest acquisition, COIN is now the fourth-largest holding within the company’s ARKK ETF, with a weighting of 6.5%, worth around $355 million. The acquisition update might be playing a role in the uptick in the price of COIN in the market. As of writing, the Coinbase stock has jumped by 2.85% and was changing hands for $161.64.
