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ARK Invest Buys Record Amount of Coinbase Stock, Despite Market Volatility

ARK Invest, led by tech-focused investor Cathie Wood, has made a record purchase of Coinbase stock amidst a volatile market. Despite Coinbase tumbling by 8% on March 10, ARK Invest bought the largest amount of the stock since the start of the year, comprising around 30% of all Coinbase purchases in 2023. This exceeds their total Coinbase stock buys of around $13 million in January and $42 million in February.

In addition to Coinbase, ARK Invest has also been actively purchasing Robinhood stock. On March 9, the company bought 265,566 Robinhood shares for its ARKK fund, following similar purchases of 268,086 and 219,883 shares on March 8 and 6, respectively.

Despite the recent market turbulence, ARK Invest remains optimistic about the cryptocurrency industry and Bitcoin in particular. Cathie Wood is one of the biggest crypto bulls in the world, predicting that Bitcoin will reach $1 million in the not-too-distant future. She sees the cryptocurrency as a promising risk-on asset, along with other technological innovations like self-driving cars and genomics.

However, ARK Invest has not been immune to the market downturn. Reports suggest that the firm has earned more than 70% of its $310 million fees since the price of its ARKK fund plummeted by 76% from its all-time high in February 2021. Despite this setback, ARK Invest has earned an average of roughly $230,000 in fees daily in 2023, as the fund’s value has slightly recovered from around $30 in early January to $37.3 in mid-March.

The latest bullish investments by ARK Invest come amid renewed market volatility, with Bitcoin dipping below $20,000 for the first time since early January. The market has been rocked by the news that Silvergate crypto bank is planning to wind down operations and liquidate the bank.

Despite the challenges facing the cryptocurrency industry, ARK Invest remains committed to its bullish outlook. The firm sees continued growth and innovation in the sector, with Bitcoin and other cryptocurrencies playing a key role in the future of finance. With the backing of investors like Cathie Wood, the industry is sure to attract continued interest and investment in the years to come.

ARK Invest Sells Portion of Coinbase Shares

Cathie Wood’s investment management firm ARK Invest has sold a portion of its Coinbase shares as the stock sees significant growth in price. After three months of active buying, ARK made its first sale of Coinbase stock in 2023, accounting for 23% of all shares acquired in March and 9% of all shares purchased this year. The remaining 1.6 million Coinbase shares held by ARK are currently valued at over $132 million.

Coinbase’s stock, which trades as COIN, has been on the rise, hitting multi-month highs as of March 21. The shares reached a price level not seen since September 2022, according to data from TradingView. Despite a 54% drop in the past year, the stock has recovered more than 130% since the start of 2023.

The upward trend of Coinbase’s stock price aligns with the positive trend in the cryptocurrency market, with Bitcoin hitting multi-month highs amid the ongoing global banking crisis. On March 22, Bitcoin surpassed $28,000, reaching its highest level in nine months. This marks a significant recovery in price levels triggered by industry crises like the collapse of FTX.

ARK Invest’s recent sale comes shortly after its largest purchase of Coinbase stock in 2023. On March 9, the investment manager bought 301,437 Coinbase shares for its ARK Innovation ETF (ARKK) and 52,525 shares for the ARK Next Generation Internet ETF (ARKW). At the time of purchase, the stock was worth about $20.5 million, but has since increased to nearly $30 million in value.

ARK Invest’s decision to sell a portion of its Coinbase shares may indicate the firm is taking profits and diversifying its portfolio. It’s worth noting that ARK Invest has been a strong supporter of the cryptocurrency industry, with Cathie Wood herself being vocal about the potential for cryptocurrencies like Bitcoin to revolutionize the financial system.

Coinbase, which went public via a direct listing in April 2021, has had a turbulent year, with the company facing regulatory scrutiny and a significant drop in the price of cryptocurrencies earlier in 2022. However, the recent surge in Coinbase’s stock price, along with the positive trend in the cryptocurrency market as a whole, may signal a brighter future for the company.

ARK Invest Buys Coinbase Shares Despite Wells Notice

Two days previous to the announcement that the Wells notification was forthcoming, ARK Invest had already sold 160,887 of its Coinbase shares using the ARK Fintech Innovation ETF. When this transaction took place in 2023, it was the first time that any of ARK Invest’s ETFs had sold Coinbase shares. In spite of the decline in Coinbase’s share price, this transaction represented the first time that any of ARK Invest’s ETFs has ever sold Coinbase shares. It is essential to take into consideration the fact that authorities and insiders at Coinbase participate in 10B5-1 selling plans months in advance, and that this tranche of sales was carried out in line with a trading strategy that was formed on August 16.

After the publication of the Wells notice, which warned of possible enforcement action by the SEC, the share price of Coinbase has not been able to recover to its former level. This is likely due to the fact that the SEC is likely to take enforcement action. Brian Armstrong, the chief executive officer of the firm, had also sold shares in his company between March 17 and March 20, only a few days before the Wells notice and the consequent decline in share price. These sales took place between March 17 and March 20.

Following the settlement that the SEC reached with Kraken on February 9, in which it was alleged that Kraken’s staking services qualified as securities, Coinbase has repeatedly asserted that its staking products are fundamentally different from Kraken’s products. This is in response to the allegations that Kraken’s staking services qualified as securities. After the conclusion of settlement talks between the SEC and Kraken, Coinbase made its claims.

In conclusion, ARK Invest has continued to purchase Coinbase shares despite receiving information from Wells and a decline in the price of Coinbase’s shares. This is the case even if the price of Coinbase’s shares has fallen. Before the Wells notice, Coinbase executed a trading plan that it had designed on August 16 in order to sell 160,887 shares from its ARK Fintech Innovation ETF. Coinbase has made the assertion that its staking products do not constitute securities in any way.

ARK Invest and 21Shares Launch Innovative Digital Asset ETF Suite

ARK Invest, led by the pro-Bitcoin advocate Cathie Wood, and 21Shares, a renowned exchange-traded product (ETP) supplier, have announced the launch of a new suite of digital asset exchange-traded funds (ETFs). This collaboration marks a pivotal step in offering investors a comprehensive range of options for integrating digital assets into their investment portfolios.

The newly launched ETF suite is unique in its approach, combining on-chain insights with traditional investment indicators. This method aims to provide a more informed and robust investment strategy in the volatile world of cryptocurrencies. The suite includes the ARK 21Shares Active Bitcoin Futures Strategy ETF (ARKA), an actively managed ETF that targets 100% exposure to Bitcoin through futures contracts.

The suite, which is expected to start trading in the coming week, will be listed on the Chicago Board Options Exchange (CBOE). It comprises five different products, each designed to cater to various aspects of digital asset investment. Notably, the suite does not offer direct investment in spot Bitcoin, as highlighted in the firms’ disclaimer. Instead, it focuses on Bitcoin and Ether futures contracts and includes a product for investing in public stocks of blockchain-related companies, named the ARK 21Shares Blockchain and Digital Economy Innovation ETF. This product aims to provide investors with holistic exposure to the advancement of blockchain technology.

The launch has sparked discussions among experts, including Bloomberg analysts James Seyffart and Eric Balchunas, regarding the potential acceptance of Bitcoin ETF registrations by the United States Securities and Exchange Commission (SEC). While there is speculation that the SEC might approve all 12 ETF registrations, the analysts emphasize that this remains a hypothesis with no definitive evidence currently supporting it.

ARK Invest Intensifies Investment in Robinhood

Cathie Wood, the renowned Bitcoin advocate and founder of ARK Invest, has recently intensified her firm’s investment in the cryptocurrency-friendly trading platform Robinhood (HOOD). ARK Invest made a significant move by acquiring 1.1 million Robinhood shares on November 8, amounting to an investment of over $9.5 million in a single day.

This acquisition involved three of ARK’s innovation-focused exchange-traded funds (ETFs): the ARK Innovation ETF (ARKK), the ARK Next Generation Internet ETF (ARKW), and the ARK Fintech Innovation ETF (ARKF). The ARKK fund led the charge, purchasing 888,500 shares of HOOD, which constituted 78% of the total shares bought that day.

Prior to this substantial purchase, ARK had been steadily buying Robinhood shares, albeit in smaller quantities compared to the latest transaction. For instance, the day before, ARK had acquired 259,628 shares for its ARKW fund, followed by another purchase of 197,285 shares on October 23.

This aggressive investment strategy coincided with Robinhood’s announcement of its plans to expand into Europe, specifically eyeing the launch of brokerage services in the United Kingdom in the coming weeks. This move by Robinhood was announced amidst a challenging period for the company, as its stock price (HOOD) dropped over 14% following an earnings report that fell short of expectations, primarily due to reduced trading volume and a shrinking customer base.

On November 8, the closing price of Robinhood’s stock was reported by TradingView as $8.37. In a parallel development, ARK has been divesting from the Grayscale Bitcoin Trust (GBTC). On the same day, ARKW sold 48,477 GBTC shares, totaling approximately $1.4 million.

Since October 24, ARK has offloaded a total of 427,573 GBTC shares, valued at around $11.9 million at the time of this report. This selling trend is nearing the total GBTC shares ARK sold in November 2022.

In addition to these market moves, ARK has announced plans to launch new ETFs focusing on Bitcoin and Ether futures contracts. This initiative will be in collaboration with 21Shares, ARK’s primary partner in cryptocurrency ETFs.

BlackRock and ARK Invest Conform to SEC's Cash Redemption Model for Bitcoin ETF

Major companies in the market, such as BlackRock and ARK Invest, have modified their S-1 registration statements in order to comply with the requirements imposed by the United States Securities and Exchange Commission. When it comes to their planned spot Bitcoin exchange-traded funds (ETFs), this update includes a significant move toward a cash redemption approach.

This strategic decision, which was signified by the submission of these revisions on December 18, 2023, symbolizes the embrace of a cash creation and redemption model over the in-kind redemptions that had been pursued in the past. Generally speaking, in-kind redemptions entail transactions that do not require monetary exchanges, such as the direct use of Bitcoin (BTC). This adjustment is in accordance with the standards that have been established by the Securities and Exchange Commission (SEC) of the United States.

The ARK 21Shares Bitcoin ETF is particularly mentioned in the registration statement of ARK Invest, which highlights the company’s change to accepting solely cash creations and redemptions. When it comes to prospective in-kind agreements, the statement does provide opportunity for them; however, this is contingent upon receiving regulatory permission. In a similar vein, BlackRock has echoed this stance, highlighting the possibilities of in-kind transactions, but this is reliant upon receiving approval from regulatory authorities.

Because of the SEC’s insistence on a “cash-only” strategy, authorized participants in these exchange-traded funds (ETFs) are now required to supply cash in order to purchase more shares. Unlike the “in-kind” technique, which allows investors to directly swap the asset that the ETF monitors (in this instance, Bitcoin) for ETF shares, this approach takes a different approach. The cash-only strategy seeks to provide better transparency on the sources of the Bitcoin that serves as the basis for the exchange-traded fund (ETF), which would presumably acquire the Bitcoin from reputable exchanges.

The reaction from the industry has been inconsistent. Eric Balchunas, an analyst for Bloomberg ETFs, adds that ARK and its partner 21Shares first rejected the cash generation approach. In fact, they even came up with an alternate mechanism for in-kind redemptions. Their final compliance is an indication of the SEC’s tough attitude on the subject, and the analyst suggests that this might pave the way for the possibility of an approval of a Bitcoin exchange-traded fund (ETF) as early as January.

This new move is a part of a larger trend in which entities that issue exchange-traded funds (ETFs), such as WisdomTree, a worldwide supplier of ETFs, have been required to conform to the SEC’s preference for cash redemptions. This strategy move among large firms such as BlackRock and ARK Invest represents a substantial adaptation to regulatory restrictions, and it may signal the beginning of a new phase in the development of Bitcoin exchange-traded funds by bringing about a new phase.

Ark Invest's Cathie Wood Challenges Vanguard's Bitcoin ETF Exclusion Decision

Cathie Wood, CEO of Ark Invest, has openly criticized Vanguard’s decision to exclude Bitcoin ETFs from its offerings. This stance by Vanguard, a behemoth in the investment sector, diverges sharply from the growing acceptance and integration of cryptocurrency in mainstream financial portfolios. Wood’s criticism is not just a singular voice but a reflection of a larger shift in investor preferences and market dynamics.

Vanguard’s Conservative Stance on Cryptocurrency

Vanguard, known for its traditional investment philosophy, has maintained a conservative approach towards cryptocurrency investments. This firm stance is aligned with the company’s long-standing policy of risk aversion and focus on generating real, positive long-term returns for investors. However, this decision has sparked considerable debate within the financial community, as it seems to overlook the burgeoning significance of decentralized monetary systems like Bitcoin.

Cathie Wood’s Stance

Cathie Wood, at the forefront of investment in disruptive technologies, described Vanguard’s decision as a “terrible” move. In her view, it deprives investors of the opportunity to engage with a significant, decentralized monetary system like Bitcoin. Wood’s critique goes beyond mere opinion, highlighting a notable shift in customer behavior. Following Vanguard’s reaffirmation of its crypto-averse policy, a significant number of users began moving away from Vanguard to platforms offering Bitcoin ETFs. This customer shift underscores a growing demand for crypto-related investment products among modern investors.

The Social Media Backlash

Vanguard’s stance has triggered substantial backlash on various social media platforms, with movements like #BoycottVanguard gaining traction. This public dissatisfaction has extended beyond social media, with advocates for Bitcoin encouraging investors to transfer their assets to more crypto-friendly platforms. Given these developments, industry analysts suggest that Vanguard might eventually reconsider its position due to the changing market dynamics.

Ark Invest’s Strategic Moves and Optimism

Amid this backdrop, Ark Invest has been making strategic moves in the cryptocurrency space. The firm sold its holdings in the Grayscale Bitcoin Trust and invested heavily in the ProShares Bitcoin Strategy ETF. This shift reflects Ark Invest’s cautious yet forward-looking approach amid the current regulatory environment. Furthermore, Ark Invest has recently received approval from the U.S. Securities and Exchange Commission to launch a Bitcoin ETF, with an ambitious target of Bitcoin reaching a valuation of $1.5 million by 2030.

Conclusion

The controversy surrounding Vanguard’s decision to exclude Bitcoin ETFs highlights a pivotal moment in the investment world. As the landscape of investments continues to evolve with the increasing integration of digital assets, traditional investment giants like Vanguard may need to reassess their strategies. Meanwhile, firms like Ark Invest are embracing the transformative potential of cryptocurrencies, signaling a significant shift in the industry’s outlook towards these emerging financial technologies.

Cathie Wood predicts Bitcoin preference shift due to ETFs and growing gold connection

In a recent statement, Cathie Wood, Chief Executive Officer of ARK Invest, made the observation that there is a perceptible tendency of investors moving away from gold and toward Bitcoin. Considering the recent introduction of exchange-traded funds (ETFs) that are based on spot Bitcoin, she believes that this pattern will continue. When there is a period of economic unpredictability, such as the regional bank crisis that took place in March 2023, when the value of Bitcoin soared by forty percent, Wood believes that Bitcoin is beginning to act more like an asset that is risk-off. It is especially clear that this is the case when there is uncertainty. Bitcoin has an inverse association with interest rates, but this move is connected to Bitcoin’s growing connection with gold. This is despite the fact that Bitcoin has a connection with gold. Bitcoin’s perception among investors has undergone a significant shift as a result of this development in comparison to traditional safe-haven assets like gold.

This illustrates that ARK Invest has a strong faith in the value proposition of the cryptocurrency as well as its potential as a store of wealth by the fact that they have made this investment. As part of its aggressive strategy in the cryptocurrency market, ARK Invest has purchased shares in its own spot Bitcoin exchange-traded fund (ETF) that are now valued at $15.9 million. This action, which underlines ARK’s commitment to Bitcoin and follows the trend, is a reflection of a bigger trend of increasing institutional interest in cryptocurrencies. This sentiment is represented in this move.

These events correlate with the period in time when the correlation between Bitcoin and gold has reached its highest peak. This is the point at which the correlation is at its highest point. This demonstrates that Bitcoin is becoming more and more recognized as a credible alternative to traditional safe haven instruments. In light of the fact that Bitcoin and other cryptocurrencies have traditionally been characterized by their high degree of volatility and their emphasis on speculation, this move is significant since it signifies a significant shift in the market. Because of the emergence of spot Bitcoin exchange-traded funds (ETFs) and the fact that institutional investors like ARK Invest are increasing their investments in cryptocurrencies, there is a growing belief that Bitcoin may provide a new investment opportunity for individuals who are interested in avoiding risk, particularly during times of economic instability. This belief is fueled by the fact that ARK Invest is leading the way in increasing its investments in cryptocurrencies.