American investor Cathie Wood portrayed an active play with Ark Invest, selling 139506 BTC shares valued at $3.8 million. The investor would subsequently acquire another tranche of 113326 Block Inc. shares across three funds estimated at $5.6 million.
Wood is banking recent acquisitions with a refined investment philosophy that often prioritizes purchasing stocks within innovative companies portraying strong growth potential. As such, Ark invested in Block following the revelation of Cash App’s 22% rally in quarter three of Bitcoin’s profits. Ark acquired the Block Inc. shares across three funds whose price hovers around $49.23.
Wood’s Ark purchased 70,022 Block Inc. shares via the ARK Innovation ETF (ARKK). The investment firm added 26345 to the ARK Next Generation Internet fund (ARKW). Its latest filing indicates that the Ark Fintech Innovation ETF (ARKF) facilitated the acquisition of 16959.
Wood’s Ark Invest Divests Additional Grayscale Investment Stocks
Wood’s Ark Invest confirmed on Monday, November 6, divesting additional stock from Grayscale Bitcoin Trust. The firm offloaded 139,506 GBTC shares valued at $3.8 million from the ARK Next Generation Internet fund (ARKW). The divestment from GBTC on Monday when the stock price closed at $26.95.
Monday’s move replicates the late October 2022 move when Ark Invest disposed of $2.5 million worth of GBTC shares. The move is surprising considering that Ark Invest chief executive Cathie Wood expressed optimism in the Grayscale Trust’s growth trajectory, citing devotion to cold storage.
A review of TradingView data shows that GBTC is exchanging hands at $26.95, 30% higher than the past month’s price within the pre-market trading. The price affirms GBTC’s discount to the net asset value (NAV), indicating how much the market price is lower than the bitcoin value represented. The price, though a remarkable rally recently, still trades 15% below the BTC value as per Block’s data.
The rally comes days after the Securities and Exchange Commission (SEC) declined not to appeal against the Grayscale Investments victory. The court directed the SEC to review Grayscale’s bid to convert the GBTC trust into the spot Bitcoin exchange-traded fund (ETF).
The securities watchdog’s decision not to appeal implies re-reviewing the pending Grayscale application. The move is likely fuelling the uptrend demonstrated by the GBTC share price, currently rallying by over 228% in 2023.
Ark Invest Adjusting Portfolio Relative to Bitcoin Price Surge
The move by Ark Invest to sell GBTC stock and purchase Jack Dorsey’s Block Inc. shares is unsurprising. The latter, led by Twitter’s founder, realized a 22% growth in Bitcoin gross profit in the third quarter. The growth brought $45 million in profit relative to the $37 million in the 2022 third quarter.
The growth in Block’s profit arises from the increase in Bitcoin’s average market price. Also, the profit rose from the uptrend realized by the Bitcoin transaction volume through the Cash App mobile-based payment services, as per the firm’s shareholder letter.
The recent market activity by Cathie Wood’s Ark Invest aligns with past adjustments to its portfolio. In 2023, Ark Invest sold Coinbase (COIN) stock estimated at millions of dollars. In particular, Ark Invest sold GBTC and Coinbase stock in October for nearly $10 million, seeking to profit from the Bitcoin price surge.
Ark Invest is divesting from GBTC when Wood’s firm awaits the SEC approval for its spot bitcoin ETF application alongside the 21Shares.
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