Cathie Wood’s Ark Invest Buys $12.6 Million Worth of Coinbase Shares

On March 27th, Cathie Wood’s Ark Invest purchased another $12.6 million worth of Coinbase (COIN) shares last Friday, which was the second consecutive day that the fund purchased shares on the Cryptocurrency Exchange after receiving a Wells notification from the Securities and Exchange Commission (SEC) on March 22nd. The stock rose 1.5% on Friday to close at $67.83 per share. According to an email sent on Friday night US time, 155833 shares went to ARK Innovation EFT (ARKK) and 26395 shares went to ARK Next Generation Internet EFT (ARKW). （CoinDesk）

Ark Invest increased its holdings of Coinbase stocks by $12.6 million and Block stocks by $18.1 million last Friday

On March 27th, Cathie Wood’s Ark Invest purchased another $12.6 million worth of Coinbase (COIN) shares last Friday, which was the second consecutive day that the fund purchased shares on the Cryptocurrency Exchange after receiving a Wells notification from the Securities and Exchange Commission (SEC) on March 22nd. The stock rose 1.5% on Friday to close at $67.83 per share. According to an email sent on Friday night US time, 155833 shares went to ARK Innovation EFT (ARKK) and 26395 shares went to ARK Next Generation Internet EFT (ARKW). （CoinDesk）

Introduction

Cathie Wood, CEO of Ark Invest, made news again with her recent purchase of Coinbase shares. This second consecutive day of purchases by the fund on the Cryptocurrency Exchange raised some eyebrows as it comes after the SEC’s warning to the firm. This article explores the incident in detail and outlines its implications for market players.

Background

Ark Invest has been on a buying spree lately, with Wood’s funds making headlines for owning shares of companies like Tesla and Square. Coinbase is another company that has now been added to the list of companies with a massive stake by Wood. Coinbase is a cryptocurrency exchange that went public via a direct listing on Nasdaq on April 14th, with the stock opening at $381 per share, pushing its valuation to about $99.6 billion.

Ark Invest’s Purchase

On March 22nd, Ark Invest received a Wells notification from the SEC, which is a document that notifies a recipient of a potential investigation. Despite this warning, Ark Invest went ahead to purchase shares in Coinbase. According to an email sent on Friday night US time, 155833 shares went to ARK Innovation EFT (ARKK) and 26395 shares went to ARK Next Generation Internet EFT (ARKW). The acquisition of these shares amounted to a whopping $12.6 million worth of Coinbase shares.

Implications for the Market

With Ark Invest’s massive holdings in Coinbase, the notion that the fund was not aware of the potential investigation and took the gamble on Coinbase raises some questions. Although the exact timing and nature of the investigation have not been publicly disclosed, this move from Ark Invest might be taken as a sign that they believe that Coinbase will come out unscathed. Moreover, the fact that a major player like Ark Invest is confident in the future of Coinbase has increased investor confidence, thereby pushing the stock price higher.

Other Possible Reasons for The Purchase

There is a possibility that Ark Invest is merely taking advantage of the dip in price after Coinbase’s debut in the public market. After the initial high price of $381 per share, COIN’s price has gone down by almost 25%. This may be a strategic move by Ark Invest to buy when prices are low and hold onto their shares until the price rises again.

Conclusion

The second consecutive day of purchases in Coinbase shares by Ark Invest amounts to $12.6 million, even after receiving a warning from the SEC. Although it is unclear why the regulatory body decided to investigate Coinbase, Ark Invest’s purchase of shares sends a clear signal that they believe in the firm’s future. Moreover, this purchase has increased investor confidence, pushing the share price higher.

FAQs

1. Why did Ark Invest purchase shares in Coinbase after receiving a Wells notification from the SEC?
– The reason is unclear. It might signal that Ark Invest is confident in the future of the company or is taking advantage of the dip in prices after the company’s debut in the public market.
2. What is a Wells Notification?
– It is a document that notifies a recipient of a potential investigation by the SEC.
3. Why did the price of Coinbase’s shares go down after the company went public?
– It might be due to the volatility of the cryptocurrency market and the fact that Coinbase’s shares were overhyped before they hit the market.