Ark Invest Sells $50 Million Worth of Coinbase Shares
According to a recent trade filing, Ark Invest sold an additional 133,823 COIN ($20.6 million) last week, bringing their total selling spree of Coinbase shares to $50 million. Cathie Wood’s investment management firm offloaded shares from its Innovation, Next Generation Internet, and Fintech Innovation ETFs.
Continued Rebalancing of Fund Weightings
Despite a 10% drop in Coinbase stock, Ark Invest has been rebalancing its fund weightings and sold $50 million worth of shares last week. This follows their previous sale of $200 million worth of shares in December when COIN’s price surged over 40%.
Coinbase Stock Performance
Coinbase stock closed at $153.98 on Friday, experiencing a 1% decline. Although the stock has seen a 350% increase in the past year, it remains 55% down from its all-time high during the crypto bull market in November 2021.
Bitcoin Spot ETF Issuers Choose Coinbase for Custody
In the pursuit of a bitcoin spot ETF approval from the U.S. Securities and Exchange Commission (SEC), asset managers like Ark Invest/21Shares, Valkyrie, and Bitwise have selected Coinbase as their custodian. However, concerns about lack of diversification and counterparty risk have been raised as most issuers opt for Coinbase’s custodial services. Fidelity and VanEck are exceptions, choosing self-custody and Gemini as custodians for their funds.
Hot Take: The Implications of Ark Invest’s Coinbase Selling Spree
Ark Invest’s continuous selling of Coinbase shares raises questions about their confidence in the company’s future prospects. Despite the recent decline in Coinbase stock and the overall volatility of the crypto market, Ark Invest’s decision to rebalance its fund weightings by offloading $50 million worth of shares suggests a strategic move to mitigate risk and optimize their portfolio. This selling spree also highlights the ongoing debate surrounding bitcoin spot ETFs and the role of custodians like Coinbase in the industry.
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