Article: Sean, Techub News
Recently, the cryptocurrency market has seen a long-awaited uptrend, with Bitcoin rising by 23% in a single month, Ethereum rising by 24% in a single month, and some altcoins even experiencing several to tens of times increase.
Just as the market was in a frenzy, some institutional investors began to take the opposite approach. The internationally renowned investment management firm Ark Invest has been aggressively selling shares of Coinbase (COIN), the largest cryptocurrency exchange in the United States. How much did they sell? Does this mean that Ark Invest is no longer optimistic about the sustainability of the rise in Bitcoin and the cryptocurrency market in the short term?
Ark Invest has reduced its holdings of Coinbase stock by over 100 million US dollars this month
In just 20 days, Ark Invest sold over $150 million worth of Coinbase stock (COIN).
On December 4, 2023, Ark Invest made its first sale of the month, selling 7,248 shares at a closing price of $140, totaling approximately $1.01 million.
On December 5, at a closing price of $140.10, Ark Invest sold 201,711 shares, totaling approximately $28.46 million.
On December 6, Ark Invest continued to sell COIN, with its three funds ARKK, ARKW, and ARKF ETF selling a total of 180,422 shares of Coinbase stock at the closing price of $134.63, generating $24.30 million.
On December 8, Ark Invest executed its largest COIN sale since July, selling 335,860 shares of Coinbase stock at a closing price of $146.62, with most of them coming from ARKK, resulting in a cash flow of $49.20 million.
However, the cash obtained from this sale was slightly lower than the cash obtained from the sale in July. In July, Ark Invest sold 480,000 shares of Coinbase stock, generating $50.50 million in cash.
Starting from December 11, Ark Invest sold 13,687 shares of Coinbase stock at a closing price of $137.35, obtaining $1.88 million in cash.
On December 12, Ark Invest sold 82,255 shares of Coinbase stock at a closing price of $139.62, obtaining $11.50 million.
On December 15, Ark Invest sold 12,142 shares of Coinbase stock at a closing price of $147.9, obtaining $1.796 million.
On December 19, Ark Invest sold 28,638 shares of Coinbase stock at a closing price of $161.16, obtaining $4.615 million.
On December 20, Ark Invest sold 132,782 shares of Coinbase stock at a closing price of $161.86, obtaining $21.492 million.
According to incomplete statistics, as of the time of writing, Ark Invest has sold over $150 million worth of Coinbase stock since December.
When were the sold stocks purchased?
Starting in January of this year, Ark Invest has been continuously increasing its holdings of Coinbase (COIN) stock. Some of the large-scale purchases and their prices are as follows:
On January 11, 2023, Ark Invest purchased 74,792 shares of Coinbase stock at a closing price of $43.79.
On February 10, 2023, Ark Invest purchased 139,105 shares of Coinbase stock at a closing price of $57.09.
On February 23, 2023, Ark Invest purchased 181,972 shares of Coinbase stock at a closing price of $61.18.
On February 24, 2023, Ark Invest purchased 128,396 shares of Coinbase stock at a closing price of $58.44.
On March 9, 2023, Ark Invest purchased 301,437 shares of Coinbase stock at a closing price of $58.09.
On March 23, 2023, Ark Invest purchased 230,599 shares of Coinbase stock at a closing price of $66.30.
On March 24, 2023, Ark Invest purchased 158,833 shares of Coinbase stock at a closing price of $67.83.
On June 6, 2023, Ark Invest purchased 329,773 shares of Coinbase stock at a closing price of $51.56.
According to Cathie's Ark data, Ark Invest held the most shares of Coinbase stock on June 7, reaching 8.34 million shares. As of December 20, Ark Invest still holds 6.19 million shares of Coinbase stock.
Cathie's Ark data also shows that Ark Invest's average cost of holding Coinbase stock is $254.65. Interestingly, since July of this year, Ark Invest has been gradually selling off its shares of Coinbase stock.
It is worth noting that in addition to Ark Invest, on July 6 of this year, several Coinbase executives, including Coinbase CEO Brian Armstrong, collectively sold 88,058 shares of Coinbase stock, earning approximately $6.9 million. Among these executives, Coinbase Chief Accountant Jennifer Jones even sold 74,375 shares on June 29, earning $5.2 million.
Cathie Wood: Reducing holdings does not mean pessimism about the future
When asked about the reason for selling Coinbase stock, Cathie Wood stated at the Bloomberg Daybreak Asia conference, "Ark Invest is very optimistic about Coinbase, especially considering the outcome of the Ripple vs. SEC case in the U.S. courts. This move is aimed at achieving investment returns and reallocating funds to other investments."
So, is Cathie Wood really "rebalancing," or is she "bluffing" to continue cashing out?
A set of data may truly reflect Cathie Wood's thoughts. The latest ARK Next Generation Internet ETF position statistics show that despite Ark Invest reducing some COIN holdings, Ark Invest's allocation of Coinbase stock still ranks first, accounting for 11.88%.
At the same time, from the proportion of holdings, we can also see that Ark Invest's holding of Grayscale Bitcoin Trust accounts for 4.66%. This means that its investment in Coinbase (COIN) and Grayscale Bitcoin Trust accounts for over 16% of the total holdings. This seems to indicate that Ark Invest has not lost confidence in the cryptocurrency market, but rather made a rebalancing move in response to market trends.
Bitcoin has seen a surge in the second half of this year, and the first factor may be the market's increasing expectation for the approval of a Bitcoin spot ETF by U.S. regulatory agencies, thereby expanding the potential investment volume for cryptocurrency investors. The second factor may be the rapid increase in market expectations for a Fed rate cut in 2024.
At the same time, Ark Invest is competing with other traditional financial industry giants (BlackRock, Fidelity, Guggenheim, etc.) for the first spot for a Bitcoin spot ETF application. Since Ark Invest submitted the application before other financial institutions, it may be the first to be approved for a Bitcoin spot ETF application.
Based on Ark Invest's holdings data, Cathie Wood's personal statements, and Ark Invest's trading of Coinbase stock, it is likely that Ark Invest's buying and selling of Coinbase stock is just part of its "buy low, sell high" trading strategy. In fact, leading international investment management institutions generally prioritize profitability, so Ark Invest's trading of Coinbase stock can be seen as a normal occurrence without any obvious subjective emotions.
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