ARK Invest Boosts Coinbase Stake Amid Crypto Rout

ARK Invest, the investment management company led by Cathie Wood, made a significant move on Tuesday by swapping nearly $9 million of its own spot bitcoin ETF (ARKB) for shares in Coinbase (COIN). As the cryptocurrency market experienced a rout, with bitcoin (BTC) falling to a three-month low below $87,000, ARK took advantage of the opportunity to increase its exposure to the crypto exchange.

ARK added 41,032 COIN shares to its Next Generation Internet ETF (ARKW), as the crypto exchange's stock fell nearly 6.5% on the day to $212.49. This purchase was the largest in dollar terms since Aug. 5, when ARK added 93.8 million shares for $17.8 million. Meanwhile, ARK sold 98,060 shares of its own spot bitcoin ETF (ARKB), worth around $8.6 million.

The rout in the cryptocurrency market on Tuesday brought about record outflows from spot bitcoin ETFs in the U.S. The funds registered net outflows of nearly $940 million, the largest single-day sale since they began trading in January 2024, according to data tracked by SoSoValue. This significant sell-off presented an opportunity for ARK to diversify its crypto holdings by investing in Coinbase, a leading crypto exchange.

The move by ARK Invest highlights the potential for strategic investments in the crypto market, even during periods of volatility. By swapping its bitcoin ETF for Coinbase shares, ARK is positioning itself to benefit from the growth and adoption of cryptocurrencies, while also gaining exposure to the broader crypto ecosystem through Coinbase's platform.