ARK Invest Doubles Down on Crypto Infrastructure, Betting on Resilience Amid Selloff

ARK Invest, the fintech ETF firm led by Cathie Wood, has intensified its bets on crypto-related assets amid a broader market selloff, purchasing shares in Circle Internet Financial, Bullish, and BitMine as digital asset prices and equities tied to the sector plummeted. The firm's ARK Innovation, ARK Next Generation Internet, and ARK Fintech Innovation ETFs collectively spent $42.2 million across three companies on Wednesday, according to a filing. Circle's stock closed down 8.98%, while Bullish fell 3.63% and BitMine dropped 9.6% according to the same filing.

The moves underscore ARK's continued focus on crypto infrastructure and stablecoin firms despite a volatile market environment. Bitcoin, the largest cryptocurrency by market capitalization, has fallen to $91,795 from a recent peak of $96,500, mirroring the decline in equities of crypto-related firms. Circle Internet Financial, issuer of the USDC stablecoin, reported a 108% year-over-year surge in stablecoin circulation to $73.7 billion in its third-quarter earnings, alongside $214 million in net income, driven by a $61 million tax benefit. The company's revenue hit $740 million, surpassing analyst estimates, though analysts at Mizuho and Needham slashed price targets, citing concerns over distribution costs and historical IPO performance.

Bullish, the crypto exchange backed by Peter Thiel, swung to a $18.5 million profit in Q3 2025, a stark contrast to its $67.3 million loss a year prior. The firm attributed its turnaround to new U.S. spot trading and options offerings, which drove adjusted revenue to $76.5 million. Deutsche Bank upgraded Bullish to Buy from Hold, citing its attractive risk-return profile despite the stock trading at 31 times its 2027 earnings estimate. However, Cantor Fitzgerald reduced its price target to $56 from $59, reflecting broader market skepticism.

ARK's purchases align with broader industry trends. Bullish's options product alone hit $1 billion in trading volume within its first quarter, while its U.S. spot trading volume rose 77% year-to-date according to CoinDesk. Circle's third-quarter earnings highlighted its role in expanding U.S. dollar dominance via stablecoins, with Deutsche Bank Research noting their critical value in global invoicing. Meanwhile, Bullish's foray into tokenization and securities listings has positioned it to capitalize on the nascent tokenized asset market.

The market's mixed reaction reflects diverging views on crypto's long-term potential. While Bernstein and Baird maintain Outperform ratings for Circle, citing its financial health and growth in USDC adoption, others remain cautious. Mizuho's $70 price target for Circle reflects concerns over profitability, given the firm's 5.28% gross profit margin and rising operating costs.

ARK's strategy, however, appears rooted in a belief that crypto infrastructure will weather short-term volatility. The firm's investments in Circle, Bullish, and BitMine-whose Ethereum treasury management services are led by Tom Lee-signal a focus on companies with strong cash flows and strategic positioning in the evolving digital asset ecosystem. As markets stabilize, these bets could prove pivotal in reshaping the crypto landscape.