ARK Invest puts $21 million in 3iQ Ether ETF after major Coinbase stock sale

On August 1, 2024, Cathie Wood’s ARK Invest executed a substantial $21 million purchase of the 3iQ Ether Staking ETF (ETHQ.U), while simultaneously offloading $14.6 million worth of Coinbase (Nasdaq: COIN).

These transactions signal a strategic realignment in ARK’s crypto-related investments.

The purchase of 1.7 million shares of the 3iQ Ether Staking ETF, worth $21 million, marks ARK’s inaugural investment in this Canadian-based fund. The ETF, which aims to offer long-term capital appreciation through investment in Ether and generates passive rewards via staking, has gained traction in recent months.

Since its launch as the 3iQ Ether ETF in 2021, and its subsequent expansion to include staking in 2023, the fund has seen significant growth, with its value surging approximately 40% year-to-date.

Since our staking program began last October, the 3iQ Ether Staking ETF has seen +24% growth in its units outstanding. It is one of few Canadian ETH ETFs to see net creations in 2024 and is currently the only ETF with staking integrated today. Welcome new investors and thank you… pic.twitter.com/miHhidWRLI

— 3iQ Digital Asset Management (@3iq_corp) June 14, 2024

Ark’s investment in 3iQ Ether Satking ETF was allocated primarily to ARK’s Next Generation Internet ETF (ARKW), which acquired around one million shares, while the remaining shares were purchased through the ARK Fintech Innovation ETF (ARKF).

This move highlights ARK’s growing interest in diversifying its portfolio with Ethereum-based assets.

Ark sold $14.7 million Coinbase shares

ARK sold 69,069 shares of Coinbase on August 1, valued at $14.7 million based on the stock’s closing price.

The stock sale coincided with Coinbase reporting a robust $1.4 billion in revenue for the second quarter of 2024, highlighting the firm’s progress in advancing regulatory clarity globally. It was ARK’s largest disposal of Coinbase shares (Nasdaq: COIN) since early April.

However, despite this, Coinbase remains a major component of the ARK Fintech Innovation ETF, constituting nearly 10% of its holdings.

Ark also offloaded ARK 21Shares Bitcoin ETF and Robinhood shares

On the same day (August 1), Ark Invest also sold 108,751 shares of the ARK 21Shares Bitcoin ETF (ARKB) for approximately $6.9 million and offloaded 282,435 Robinhood shares, totalling $5.7 million.

These strategic moves by ARK Invest underscore a dynamic approach to cryptocurrency investments, reflecting both a repositioning towards Ethereum and a reevaluation of their stake in prominent crypto and financial platforms.

Notably, Ark’s investment in 3iQ Ether ETF came on a day that saw Ether ETFs post a net inflow of $26.7 million, with inflows into BlackRock’s Ether ETF fund outpacing outflows from Grayscale’s Ethereum Trust according to data on Faride Investors.

Also, it comes at a time when the crypto market is experiencing a significant drop with Ethereum (ETH) testing a daily low of $2,988.65 and Bitcoin testing a daily low of $62,248.94 according to Coinmarketcap.

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