Ark Invest Offloads Coinbase Shares Surprisingly After a Profitable Quarter Amid Bitcoin Surge

On a day when cryptocurrencies saw a notable increase in value, Ark Invest, led by the influential investor Cathie Wood, decided to rebalance its investment portfolio. The firm sold off a substantial portion of its holdings in Coinbase Global Inc (COIN), just as the cryptocurrency exchange reported unexpectedly positive earnings for its fourth quarter.

Divesting Coinbase Shares

Ark unloaded 162,762 shares of Coinbase, valued at approximately $26.7 million, across the ARK Innovation ETF (ARKK) and ARK Genomic Revolution ETF (ARKG). This action came as Coinbase shares closed up by 3.3% at $165.67, immediately after releasing their Q4 financials. Earnings for the quarter were $1.04 per share on revenues of $953.79 million, soundly beating Wall Street expectations of a breakeven quarter on revenue predictions of $822.36 million.

Cryptocurrencies, including Bitcoin, experienced a rallying valuation, suggesting an optimistic market view. Indeed, on the day of Ark's sale, the 'Coinbase Premium Index,' indicative of Bitcoin's price discrepancy on Coinbase versus Binance, reached its highest peak since May 2023.

Adjustments Beyond Coinbase

Beyond Coinbase, Ark Invest tailored its portfolio in the AI sector by reducing its stakes in two other tech giants. The firm sold 4,671 Nvidia shares through the ARK Autonomous Technology & Robotics ETF (ARKQ) and ARKG for approximately $3.4 million, as Nvidia's stock slipped slightly. They also let go of 12,146 Alphabet shares via ARKQ totalling $1.75 million after news about OpenAI potentially challenging Google with a new search tool.

These moves reflect Wood's strategy to align with evolving market conditions, particularly in the AI landscape where both Nvidia and Alphabet are key figures. Nvidia, valuable for its AI technology, may have been sold due to its perceived high valuation, and Alphabet shares faced pressure with new competition arising for Google's search engine dominance.

Other Noteworthy Transactions

Ark has not only divested but also made strategic purchases. For example, it bolstered its position in Unity Software Inc, showing a vote of confidence in its future in games and software development. A similar increase was made in 10X Genomics Inc, indicating a bullish stance on genomics. Conversely, Ark disposed of shares in companies like Twilio Inc and Zoom Video Communications, suggesting a recalibration from businesses that saw surge during the pandemic to those with potential for sustained growth.

ArkInvest, Coinbase, Earnings