TL;DR
- Ark Invest sold 13,780 Coinbase shares for $3.9 million as part of a rebalancing of its Fintech Innovation ETF (ARKF).
- The sale occurred after a 10.2% drop in Coinbase’s price, influenced by a hawkish speech from Jerome Powell, Chairman of the U.S. Federal Reserve.
- Despite the volatility, Ark Invest maintains a positive long-term outlook for digital assets, with a 54% return on its ARKF ETF this year.
Ark Invest, the investment firm led by Cathie Wood, made a sale of Coinbase (COIN) shares, totaling 13,780 shares worth $3.9 million.
The sale took place on Wednesday and is part of a rebalancing strategy for the Fintech Innovation ETF (ARKF), which aims to adjust the weightings of its assets. It is part of the firm’s policy to avoid any single stock representing more than 10% of the portfolio of its funds, in order to maintain diversification. Coinbase shares now represent 9.9% of this fund, making it the second-largest holding, after Spotify.
Ark Invest’s decision comes amid significant volatility in financial markets, marked by a drop in Coinbase’s stock value. The stock price fell by 10.2% on December 18, closing at $279.86, after Jerome Powell, Chairman of the U.S. Federal Reserve, gave a hawkish speech.
In his speech, Powell reduced the 2025 rate-cut projections from four to just two adjustments, which generated uncertainty in the markets. As a result of these statements, COIN’s price suffered a considerable drop, while the crypto market also experienced fluctuations, with Bitcoin temporarily falling below $100,000.
Ark Invest’s ETF Has Seen a 54% Return This Year
Despite the market price drop, Ark Invest continues to bet on the accumulation of digital assets, and the ARKF ETF continues to show a positive return of 54% this year. According to the firm’s latest disclosures, Coinbase holdings in the fund are worth over $110 million. Furthermore, the crypto market has shown partial recovery, with Bitcoin’s price rebounding above $102,000 in the hours following the drop.
Despite short-term uncertainties, analysts foresee that expectations regarding Donald Trump’s presidency and his Bitcoin-related policies could generate more volatility in the market. However, the long-term outlook remains positive for digital assets, especially with the continued attraction of investments in Bitcoin and Ethereum ETFs
