Cathie Wood's Ark Invest snaps up nearly $10 million in Coinbase and Circle stock

Ark Invest bought 54,776 Coinbase (COIN) shares, worth approximately $8 million, across three of its exchange-traded funds on Monday, adding to its holdings after the crypto exchange's shares slumped following last week's earnings report.

Of the total acquisition, the Cathie Wood-led investment firm bought 38,761 Coinbase shares ($5.7 million) for its Ark Innovation ETF (ARKK), 11,133 shares ($1.6 million) for its Ark Next Generation Internet ETF (ARKW), and 4,882 shares ($715,000) for its Ark Fintech Innovation ETF (ARKF) as the company continues to rebalance its fund weightings amid market volatility.

Ark's investment strategy aims to let no individual holding take up more than 10% of a fund's portfolio. This is to maintain diversification within its funds — meaning Ark is likely to continue rebalancing its weightings if the value of Coinbase shares rises or falls significantly relative to Ark's other holdings in its funds.

According to the firm’s disclosures, COIN is currently the sixth-largest holding within its ARKK fund, with a weighting of 4.2%, worth around $238 million, as of Aug. 4, behind Tesla, SpaceX, Tempus AI, CRISPR Therapeutics, and Shopify. COIN represents the eleventh-largest holding in its ARKW fund and the fifth-largest in its ARKF fund, worth $56.8 million and $38.5 million, respectively.

COIN closed up 0.2% on Monday at $146.50 after dropping more than 14% following Coinbase's Q2 earnings results last week, according to The Block's COIN page. The decline came despite Coinbase reporting strong growth in its prediction markets business and record trading market share in the second quarter.

JPMorgan said Coinbase's results reflected a "tough crypto environment" with "limited P&L upside from new products," while Bernstein wrote that although the company's long-term strategy remains compelling, investors are "looking for more inspiring execution."

Coinbase is currently valued at $27.2 billion, according to The Block's data dashboard.

Ark buys Circle stock, offloads Solmate

Ark also bought another 23,070 Circle shares on Monday, worth approximately $1.4 million, for its ARKK and ARKW funds as the stablecoin issuer's stock fell 3.6% to close at $60.35, down 25% year-to-date.

CRCL represents the ninth-largest holding in its ARKK fund and the twelfth-largest in its ARKW fund, worth $210.5 million and $56.1 million, respectively.

Last week, Circle secured a limited-purpose trust charter from the New York Department of Financial Services for Circle Internet Trust Company, which expands the regulatory base for its stablecoin. Meanwhile, Bernstein cut its Circle price target to $140 from $190 but kept an Outperform rating, saying the Open USD consortium threat that hammered the stock will fade.

Ark also offloaded another 5,700 Solmate Infrastructure (Brera Holdings) shares worth nearly $25,000 from its ARKK, ARKW, and ARKF funds on Monday as the Nasdaq-listed stock gained 10% to hit $4.31 at close.

The Solana-focused DAT secured $300 million through a private placement last year with the backing of Ark Invest and the Solana Foundation. However, like many of its DAT counterparts, the stock has struggled in recent months as the once-hyped sector continues to collapse. Solmate shares have fallen 99% since their September peak.