Cathie Wood’s Ark Invest has shown unwavering confidence in Coinbase, the prominent crypto exchange operator, by purchasing additional shares on the same day the company was hit with a lawsuit by the US SEC. The move comes amidst a sharp decline in Coinbase’s stock price due to the legal action.
Despite the challenging situation, Ark Invest’s flagship ETF, Ark Innovation, along with its Next Generation Internet ETF and Fintech Innovation ETF, collectively acquired 329,773 shares of Coinbase, amounting to a total investment of $21.64 million.
This article delves into Ark Invest’s decision to bolster its stake in Coinbase and their overall bullish outlook on the crypto exchange.
On Tuesday, Ark Innovation ETF purchased 329,773 shares of Coinbase, while Ark Next Generation Internet ETF and Ark Fintech Innovation ETF bought 53,885 and 35,666 shares, respectively.
With a closing price of around $52 per share on that day, the combined investment was valued at $21.64 million.
Despite Coinbase’s stock experiencing a 21% drop during the day and ultimately closing down 12% following the SEC lawsuit, Ark Invest expressed its confidence in the exchange by increasing its holdings.
Coinbase faced legal action from the SEC, which accused the company of allowing the trading of unregistered securities. The lawsuit caused a significant decline in Coinbase’s stock price.
However, Ark Invest remains bullish on Coinbase, with the company’s shares ranking as the fifth-largest holding across its funds.
Ark’s various funds currently hold nearly $650 million worth of Coinbase stock, acquired at an average cost between $239 and $255 per share.
Despite the regulatory challenges and the negative impact on Coinbase’s stock price, Ark Invest’s decision to increase its investment in the crypto exchange reflects their belief in the company’s long-term prospects.
As Coinbase vows to take the legal battle to the Supreme Court, Ark Invest remains committed to its bullish stance on the potential of Coinbase and the cryptocurrency industry as a whole.
