ARK doesn’t seem worried about Silvergate, as it increases its exposure to Coinbase by over 700,000 shares in 2023.
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Exchange Coinbase remains a firm “buy” for ARK Invest amid recent price declines.
ARK is continuing to buy Coinbase shares, despite bankruptcy concerns about Coinbase’s main partner Silvergate Bank, according to recent reports.
ARK ETF continues to complement Coinbase shares
In the latest indication of its fearless approach to the crypto space, ARK acquired another 47,568 shares of Coinbase stock on March 7.
This is the third purchase of the week, adding to the nearly 6 million shares held in the ARKK exchange-traded fund (ETF) earlier this month.
Coinbase has been under pressure since early February, falling from local highs of $87.50 to its current low of $61.69 — a nearly 30 percent drop in one month, according to TradingView.
Although Silvergate has conducted a new investigation into crypto exchanges, the developments do not worry ARK and its CEO Cathy Wood, who want to support the trend and increase exposure to assets such as Coinbase, even in the 2022 bear market.
In a recent edition of its weekly newsletter, published on February 27th, ARK hinted at its rationale, expressing its excitement over Coinbase’s announcement of its Tier 2 Ethereum network, Base.
“In our view, Coinbase’s decision to build and integrate its services into a decentralized crypto infrastructure demonstrates its deep alignment with the fair, transparent and accessible financial services that public blockchains offer,” he wrote.
“While it may not be able to generate revenue from transactions on the database, Coinbase will likely benefit financially if its wallet serves as a reliable on-ramp and access point to applications on the network.”
The acquisitions came at a price – the company is currently valued at $254 per share.
GBTC Inches As Bitcoin ETF War Hits
Also this week, the largest institutional Bitcoin investment vehicle is Greyscale Bitcoin Trust (GBTC).
RELATED: GBTC approval could return ‘several billion dollars’ to investors: Grayscale CEO
Amid a crisis for its owner Grayscale in its long-running struggle to convert and launch GBTC as an ETF in the US, the trust saw a modest increase in price earlier in the week.
A court is currently deciding whether the US regulator, the Securities and Exchange Commission, has the right to refuse to launch the first Bitcoin spot price ETF on the market.
GBTC remains close to a record discount to Bitcoin’s price, with its shares trading 50% lower than BTC/USD, according to data from resource monitor Coinglass.
As always with the ETF story, criticism remains.
“The approval of the GBTC spot ETF could lower the price of BTC and boost the ETF,” argued statistician Willie Wu on March 8.
“The pent-up selling pressure on GBTC built in a bear market will be released into the open market.”
Meanwhile, ARK has a stake of 5.53 million GBTC, which has been increasing since November 2022, after the FTX debacle. In January, he reduced his holdings by 500,000 shares.
