Cathie Wood's Decision to Sell Coinbase Shares for Robinhood: Explained

ARK Invest Sells Coinbase Shares Amid Binance Litigation

ARK Invest, led by Cathie Wood, recently sold $5.3 million worth of Coinbase shares after the price surged due to US litigation against Binance. This move does not indicate a change in Wood’s bullish Bitcoin outlook.

This is the third time Wood has sold Coinbase shares this year. She sold $103 million worth in July and 65,376 shares in October. Instead, she purchased $1.2 million in Robinhood shares.

Wood Sees Profit Potential in Robinhood

The sales do not mean that Wood has lost faith in Bitcoin. Rather, ARK likely sold shares to adjust the weighting of Coinbase stocks in its ETFs. The earlier sales of Grayscale Bitcoin Trust (GBTC) were also to maintain the weighting of GBTC in her ETF baskets.

Buying Robinhood shares indicates that Wood sees potential in the stock and crypto brokerage, despite a decline in crypto trading revenues. Robinhood reported a 26% drop in crypto trading revenues this year.

ARK Still Bullish on Bitcoin

While the recent sales have sparked speculation about Wood’s Bitcoin thesis, her earlier bullish views remain intact. ARK Invest and 21Shares filed for a Bitcoin spot ETF application earlier this year.

Wood stated that ARK and 21Shares plan to launch five crypto exchange-traded products on the Cboe exchange, including futures and cash options for Bitcoin and Ethereum.

Hot Take: ARK Invest Adjusts Portfolio Weightings

ARK Invest’s recent sale of Coinbase shares is not indicative of a change in Cathie Wood’s bullish outlook on Bitcoin. Instead, it appears to be a strategic move to adjust the weighting of Coinbase stocks in the company’s ETFs. Wood’s earlier sales of Grayscale Bitcoin Trust shares followed a similar strategy.

Wood’s decision to purchase Robinhood shares suggests she sees profit potential in the stock and crypto brokerage, despite a decline in crypto trading revenues. This move aligns with her long-term optimism about the crypto market.

Overall, ARK Invest remains bullish on Bitcoin and plans to launch several crypto exchange-traded products in collaboration with 21Shares. Wood believes that the crypto bull market is already underway and predicts that Bitcoin will outperform crypto-related equity investments in the long term.