Cathie Wood’s ARK Invest sells $50.5M of Coinbase shares

Cathie Wood's ARK Invest sells $50.5M of Coinbase shares

The Rise and Fall of Coinbase: Insights from ARK Invest

Source: Ark Invest / Instagram

The blockchain industry has been abuzz with recent developments surrounding Coinbase (COIN), the leading cryptocurrency exchange. One of the largest holders of Coinbase shares, ARK Invest, has made headlines for its strategic moves in the market. With over 10.5 million shares, ARK Invest has been a significant player in the Coinbase ecosystem.

ARK Invest profits from the recent Coinbase rally

In an unexpected turn of events, ARK Invest recently started selling its Coinbase shares. The firm made its first sale on July 11th, earning $12 million as the stock reached a one-year high of $89. Sensing further potential, ARK Invest made another sale on July 14th, cashing in an additional $50.5 million as Coinbase’s share price soared to $107. In total, ARK Invest sold over 480,000 COIN shares across three different funds. Despite these sales, the company still retains a substantial holding in Coinbase.

The surge in Coinbase’s share price was primarily fueled by the firm’s participation in surveillance-sharing agreements, including a partnership with BlackRock. BlackRock sought this agreement after the US Securities and Exchange Commission (SEC) rejected its Bitcoin ETF proposal due to surveillance-related concerns. By choosing Coinbase as a partner, BlackRock aimed to address these concerns and subsequently re-filed its Bitcoin spot ETF proposal.

Coinbase shares rose following surveillance-sharing agreements

Prior to the partnership with BlackRock, Coinbase’s shares experienced instability due to the SEC’s lawsuit against the exchange on June 5th. However, the collaboration with BlackRock helped solidify Coinbase’s position and initiated a rally in its share price. Recognizing the potential risks associated with the SEC’s decision on BlackRock’s proposal, ARK Invest capitalized on the rally and sold off its Coinbase shares.

It is worth mentioning that several other firms also entered into surveillance-sharing agreements with Coinbase, attempting to address similar concerns raised by the SEC regarding their own Bitcoin ETF proposals. However, these proposals were also rejected by the SEC, highlighting the significance of resolving surveillance-related issues for regulatory approval.

Will the US finally get its own Bitcoin ETF?

The blockchain community is eagerly awaiting the SEC’s decision on Bitcoin spot ETF proposals, hoping for approval after the resolution of past concerns. The partnerships formed by Coinbase, including the agreement with BlackRock, have successfully addressed the issues identified by the SEC. As a result, there are no apparent reasons for the SEC to reject these proposals, leading to the consideration of BlackRock’s re-filing.

While ARK Invest took advantage of the recent Coinbase rally to sell its shares, it remains unclear whether the firm plans to continue divesting or if these two sales will be the last in the foreseeable future.

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