Cathie Wood’s Ark Investment Management Reduces Coinbase Stake amid Recent Stock Rally

by Nik Asti

Published: July 12, 2023 at 6:00 am Updated: July 12, 2023 at 4:41 am

by Danil Myakin

Edited and fact-checked: July 12, 2023 at 6:00 am

In Brief

Cathie Wood’s Ark Investment Management LLC reduced its holding of Coinbase Global Inc. for the first time in almost a year, signaling potential profit-booking.

Ark Investment Management LLC, under the helm of Cathie Wood, has reportedly lessened its stake in Coinbase Global Inc. This move comes as the first reduction in almost a year, signifying potential profit-taking amid the recent rally in the stock’s value.

Cathie Wood's Ark Investment Management Reduces Coinbase Stake amid Recent Stock Rally

Ark Investment Management has been purchasing Coinbase stock during price dips for nearly 11 months until June. They continued increasing their stake during periods of cryptocurrency market volatility. Events like a US regulatory clampdown on crypto, Sam Bankman-Fried’s empire collapse, and multiple bankruptcies sparked this volatility.

Ark cut its Coinbase stake on the same day the stock rallied by 9.8%. This rally followed a filing with the Chicago Board Options Exchange. This filing boosted optimism about possible US Bitcoin ETF approval. Wood’s fund scaling down its Coinbase stake might suggest other investors to cash in on the rally.

Cathie Wood and Coinbase

Coinbase has seen a substantial increase of over 150% this year. This aligns with the broader rally experienced by cryptocurrency-linked stocks, despite the ongoing lawsuit from the Securities and Exchange Commission. Contrastingly, the previous year had seen a drop of 86% in its value.

In comparison, Wood’s flagship fund, the Ark Innovation ETF, has seen an increase of 51% this year. This performance has surpassed the Nasdaq 100 Index’s gain of 38% and the S&P 500’s advance of 16%. However, it is noteworthy that the Ark Innovation ETF faced a decline of 67% last year.

Ark Investment Management LLC’s move to cut its stake in Coinbase Global Inc. points to potential profit-making amid the ongoing share rally, after a year of buying during price dips.

Ark’s decision to pare down its stake in Coinbase may signal a strategic move to secure gains during this rally. Given that Coinbase’s stock has more than doubled this year, despite some market setbacks, it’s reasonable to speculate that Ark is capitalizing on this strong performance. However, it’s also worth noting that Ark remains a substantial holder, indicating its continued confidence in Coinbase’s long-term prospects.

The crypto community has come together to create 140,830 NFTs called “Stand with Crypto” to influence U.S. regulators to create a sensible crypto policy.

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About The Author

Nik is an accomplished analyst and writer at Metaverse Post, specializing in delivering cutting-edge insights into the fast-paced world of technology, with a particular emphasis on AI/ML, XR, VR, on-chain analytics, and blockchain development. His articles engage and inform a diverse audience, helping them stay ahead of the technological curve. Possessing a Master's degree in Economics and Management, Nik has a solid grasp of the nuances of the business world and its intersection with emergent technologies.

Nik Asti