BREAKING: Cathie Wood’s Ark Invest Sells Entire Grayscale Bitcoin Trust (GBTC) Holdings to Purchase BTC Futures ETF – Is a $30,000 Correction on the Horizon?

• Ark Invest divests completely from Grayscale Bitcoin Trust (GBTC) in its ARKW portfolio, opting for a shift towards Bitcoin futures through ProShares’ Bitcoin Strategy ETF ($BITO).
• Ark Invest, as part of its portfolio rebalancing, sold 148,885 shares of Coinbase and reinvested around $92 million in ProShares Bitcoin Strategy ETF ($BITO).

In a significant development in the cryptocurrency sector, Ark Invest, led by renowned investor Cathie Wood, has made a strategic move by completely divesting from Grayscale Bitcoin Trust (GBTC), a notable asset in its ARKW portfolio.

The shift towards Bitcoin futures, particularly through the BITO – ProShares’ Bitcoin futures ETF launched in October 2021, signals a substantial change in investment strategy for Ark Invest. This move further underscores the dynamic nature of cryptocurrency investments and the evolving regulatory landscape, as reported on the X platform based on Collin Brown’s tweet, shedding light on the magnitude of Ark Invest’s strategic shift.

Moreover, Ark Invest’s decision is timely, aligning with the period leading up to the anticipated approval of the spot Bitcoin ETF by the U.S. Securities and Exchange Commission (SEC). The cryptocurrency market has already witnessed reactions, evident in actions taken by Coinbase executives who sold shares in $COIN.

This strategic move by Ark Invest can be interpreted as a portfolio realignment in anticipation of the new ETF or as a precautionary measure against potential market fluctuations ahead of the January 10, 2024, deadline.

#ARKInvest has just liquidated their entire #GBTC position, which was once ARKW's top holding.

They're now diving into #Bitcoin futures with half of the $100 million from the sale, courtesy of BITO – ProShares' Bitcoin futures ETF launched in Oct '21. A strategic… pic.twitter.com/2wiWdmkX09

— Collin Brown (@CollinBrownXRP) December 28, 2023

Ark Invest Moving Funds into BITO

Bloomberg Intelligence analyst Eric Balchunas also reported that Ark Invest diverted a significant portion of the funds from the share sale to acquire ProShares Bitcoin Strategy ETF ($BITO) stock.

Balchunas disclosed that Ark Invest invested approximately $100 million, or half of the funds from the GBTC sale, into $BITO. This move is likely part of Ark Invest’s strategy to utilize $BITO as a liquid transition tool ahead of the anticipated launch of ARK 21Shares Spot Bitcoin ETF ($ARKB) and ARK Next Generation Internet ETF ($ARKW). With this investment in $BITO, Ark Invest has become the second-largest holder of ProShares Bitcoin Strategy ETF stock.

“Just like that, ARK is now the second biggest holder of $BITO, although again, this is a temporary parking spot,” remarked Balchunas.

Cathie Wood’s optimistic outlook on the anticipated approval of the Bitcoin ETF by the SEC has instilled hope in the crypto community. Her engaged discussions with SEC officials, marked by detailed and technical dialogues, suggest a fruitful exchange on the future of cryptocurrency ETFs.

As the crypto industry anxiously anticipates regulatory decisions, Ark Invest’s recent portfolio adjustments showcase its adaptability and forward-thinking approach to navigating the ever-changing landscape of the digital asset market.

Ark Invest Offloads Coinbase Shares

In addition to offloading the GBTC shares, Ark Invest also offloaded its Coinbase (NASDAQ: COIN) holdings.

Cathie Wood’s Ark Invest divested another 148,885 shares of Coinbase, valued at around $27.58 million, on Wednesday. Simultaneously, the company acquired approximately $92 million worth of ProShares Bitcoin Strategy ETF (BITO), along with 4,320,928 units of the U.S. Bitcoin futures-linked ETF.

The ARK Next Generation Internet ETF (ARKW) executed the sale of Coinbase shares on Wednesday, marking a continuation of the firm’s selling trend, having already offloaded over $200 million in Coinbase shares in the past month.

Despite the selling spree, Coinbase stock experienced a 7.67% increase, closing at $185.24 on the mentioned day. Ark Invest’s decision to rebalance its fund weightings has been a response to the significant surge in Coinbase’s stock price, which has risen by 54.6% over the past month.