Ark Invest Keeps Eye on Crypto Space with GBTC and COIN Moves
• Ark Invest sold 500k shares of GBTC in the past month, despite the price of the crypto recovering from its lows.
• GBTC is currently trading at $12.25, down from the $7.46-$9.48 range it was in back in November 2022.
• Ark Invest has also been accumulating shares in Coinbase (COIN) and the Coinbase stock weight in the Ark Investment portfolio has increased to 3.4%.
Cathie Wood’s Ark Invest has been making waves in the cryptocurrency space with their recent decisions. In November 2022, Ark Invest bought shares in Grayscale Bitcoin Trust (GBTC) despite the lack of transparency on Grayscale’s part. This decision was part of the firm’s ARK Next Generation Internet ETF (ARKW). Since then, the price of bitcoin and GBTC have seen a significant recovery, with GBTC reaching a price of $12.25.
However, Ark Invest has decided to reduce its holdings in GBTC by 500,000 shares. According to reports, this decision was made in line with the firm’s ‘bearish view’ on GBTC, due to the filing of Genesis Global for bankruptcy claiming $1 billion to $10 billion in liabilities to creditors. Consequently, the GBTC discount has been reduced from 50% to 40%.
The sale of GBTC shares has been concurrent with an accumulation of Coinbase (COIN) shares. ARKW also added 320,000 shares worth $17.6 million in 2023. Following this boost, the Coinbase stock weight in the Ark Investment portfolio has increased to 3.4%.
Unfortunately, due to rejections from the SEC, Grayscale has yet to convert its bitcoin trust into an ETF. Moreover, if the SEC approves the conversion, GBTC’s discount could be reset to zero. It will be interesting to see how Ark Invest’s decisions in the crypto space play out in the coming months.