In a strategic move, Ark Invest has sold over $29 million worth of COIN shares from its ETFs, further reducing its stake in the crypto exchange Coinbase. This decision aligns with Ark's target weighting policy and comes after Coinbase's strong performance in the last quarter of 2023.
Ark Invest's Recent Sales
On January 3, Ark Invest sold a total of 166,183 COIN shares from its Innovation ETF (ARKK) and Next Generation Internet ETF (ARKW) for a value of $25.3 million at the closing price for the day. The following day, on January 4, Ark sold an additional 26,743 COIN shares valued at $4.16 million at its closing price.
These recent sales are not unusual for Ark Invest. The company's ETFs are target-weighted, meaning that no individual holding should exceed 10% of the fund's total value. With COIN's price doubling in Q4 of 2023, it has surpassed this 10% target in both ARKK and ARKW, leading to these sales. In fact, Ark has been selling COIN shares throughout December, including $33 million worth on December 5 and $42 million on December 13.
The SEC's Impact on Ark Invest's Strategy
These sales come at a time when the U.S. Securities and Exchange Commission (SEC) is considering the approval of spot bitcoin ETFs. Currently, there are 13 proposed spot bitcoin ETFs under review by the SEC. The first deadline for the joint application submitted by Cathie Wood's Ark Invest and 21shares is on January 10. Coinbase has also announced its plans to introduce spot Bitcoin and Ethereum products to international clients and extend these offerings to retail investors in the near future.
Ark Invest's Crypto Moves
Ark Invest has been active in other areas of the crypto market as well. In late December, the company liquidated its remaining holdings in the Grayscale Bitcoin Trust (GBTC), which were worth $200 million. Approximately half of these funds were then reallocated into the Bitcoin Futures ETF Bito.
Will Coinbase be able to maintain its exceptional performance if a spot bitcoin ETF is approved? Share your thoughts and opinions on this subject in the comments section below.
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