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Ark dumps 500K GBTC shares, adds Coinbase stock as Bitcoin recovers 40%

Ark dumps 500K GBTC shares, adds Coinbase stock as Bitcoin recovers 40%

Cathie Wood’s Ark Invest offloaded a chunk of its Grayscale Bitcoin Trust (GBTC) shares since November’s Bitcoin (BTC) price lows, the latest data shows.

Cathie Wood’s Ark short-term cautious on GBTC

Ark Invest added 450,272 GBTC shares worth $4.5 million to its ARK Next Generation Internet ETF (ARKW) in November 2022. At the time, GBTC was trading in the $7.46-$9.48 range versus $12.25 in January 2023.

GBTC price, of course, recovered alongside Bitcoin, rising roughly 40% from its November lows. The recovery in January also helped reduce the GBTC “discount” from nearly 50% to 40%, according to YCharts.

GBTC daily price chart. Source: TradingView

Interestingly, the share price rebound coincided with a reduction in ARKW’s GBTC holdings by 500,000 shares, suggesting profit taking in the short ter.

GBTC shares (purple) in Ark’s ETF versus its price (orange). Source: Cathiesark.com

Moreover, Ark’s reduction in shares since November appears in line with its officially “bearish view” on the Grayscale Bitcoin Trust, as mentioned in its December report, which stated that:

“The Digital Currency Group (DCG) appears to be one of the biggest questions marks in the crypto industry at this time.”

The company also expressed concerns about Genesis Global, a cryptocurrency lender owned by DCG. Genesis filed for bankruptcy while claiming $1 billion to $10 billion in liabilities to over 100,000 creditors.

Meanwhile, Grayscale has been unable to convert its Bitcoin trust into an ETF following rejections from the U.S. Securities and Exchange Commission (SEC). As Cointelegraph reported, an approval from the SEC could reset GBTC’s discount to zero.

Nonetheless, as of Jan. 23, GBTC’s share weight in Ark’s portfolio has actually increased to 0.52% compared to its November 2022 low of 0.35%. 

GBTC shares’ weight (purple) across Ark ETFs. Source: Cathiesark.com

Ark adds $17.6M in Coinbase stock

Ark’s selling of GBTC shares in the past weeks coincided with accumulation of Coinbase (COIN) shares. 

Cathie Wood’s ARKW added 320,000 COIN shares (about $17.6 million) in 2023. As a result, the Coinbase stock’s weight in Ark Invest’s combined ETF portfolios has reached nearly 3.62% on Jan. 23 versus 2.73% at the start of this year.

COIN shares (purple) in Ark’s ETF versus its price (orange). Source: Cathiesark.com

Overall, Ark appears to be only increasing its exposure to the Bitcoin market, particularly as Wood is well known for her consistent $1 million BTC price prediction by 2030. 

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