Cathie Wood’s ARK Dumps All GBTC Shares Before Spot Bitcoin ETF Arrival In January

Cathie Wood’s ARK Invest has offloaded its remainder of Grayscale Bitcoin Trust (GBTC) shares as investors await the greenlighting of an exchange-traded fund that will invest directly in Bitcoin (BTC) in less than three weeks.

ARK Invest BTC Investment Strategy Shift

As reported by Bloomberg Intelligence, Ark Invest has dumped its remaining shares of the Grayscale Bitcoin Trust (GBTC), worth around $200 million.

ARK used $100 million of the proceeds of the sale to purchase shares in the ProShares Bitcoin Strategy ETF (BITO). Notably, the company offloaded 2.25 million GBTC shares and bought 4.32 million BITO shares.

This strategic change in holdings comes just a month after GBTC occupied the top spot in ARK Invest’s portfolio. But ARK commenced its selling spree in October, offloading its GBTC position as Bitcoin first skyrocketed to $34K.

After the $100 million BITO purchase, ARK Invest has now become the second-largest holder of the BTC futures ETF, Bloomberg Intelligence analyst Eric Balchunas revealed. However, he pointed out that “this is a temporary parking spot” for the asset manager as it scouts for a more liquidity-rich portfolio. 

BTC Spot ETF Approval Looks Nigh

ARK Invest’s investment shift comes amid heightened speculation about the Securities and Exchange Commission (SEC) potentially allowing a spot bitcoin ETF to trade in the US. Both Grayscale and Ark 21Shares have ETF paperwork filed with the Wall Street financial regulator, which has held a flurry of meetings with contenders.

Last week, Barry Silbert resigned as Grayscale Investments chairman as the firm finally caved to cash creations in its amended application, sparking speculation that the moves could significantly increase the odds that Grayscale will successfully transform GBTC into a spot Bitcoin ETF.

Bloomberg’s Balchunas has given a 90% odds of a greenlight for a spot bitcoin ETF before the deadline of Jan.10, 2024. The approval of such an investment product would undoubtedly signal a watershed moment in the history of crypto, given the SEC has denied basically all applications that have crossed its desk in the past decade. 

ARK Invest CEO Cathie Wood said during a recent interview that she expects some investors to “sell on the news” of spot Bitcoin ETF approval in the short term, although the long-term outlook remains bright.