Cathie Wood's Ark Invest sheds Coinbase shares
Cathie Wood's Ark Invest dumped more than 1.4 million shares of Coinbase stock just a day after a report surfaced that the SEC is investigating the crypto exchange for trading unregistered securities.
Why it matters: The sale Tuesday appears to represent a drop in confidence on the part of one of Coinbase's biggest shareholders, which is taking a huge loss on its trades.
Details: According to Ark's daily trade newsletter, the sale was spread out over three of the firm's actively managed funds — with flagship fund ARKK selling off 1.1 million shares.
- Coinbase shares fell more than 20% on Tuesday, closing at $52.93. The value of offloaded shares would be around $75 million at that price.
- According to stock tracking firm Unusual Whales, Ark had purchased Coinbase shares at an average cost of $254.65, which suggests the firm lost over $280 million on its trades.
Yes, but: Despite Tuesday's sale, Ark is still a major Coinbase investor. According to Bloomberg data, the firm was the crypto exchange's third-largest shareholder at the end of June, holding about 8.95 million shares across its funds.
Of note: Coinbase shares have struggled, but so have Ark's funds. Since December, Ark Investment Management has lost nearly half of its assets under management, with ARKK alone plunging 54% this year.