Cathie Wood-led ARK Investment Management bought 172,276 shares of cryptocurrency exchange platform Coinbase Global Inc COIN at an estimated valuation of over $5.7 million based on Thursday’s closing price.
The purchase was done via the ARK Fintech Innovation ETF ARKF, in which Coinbase is the third largest holding, and the ARK Next Generation Internet ETF ARKW that has the company as its eighth largest holding.
Coinbase shares closed over 11% down on Thursday after analysts warned of declining trading volumes and elevated scrutiny in the wake of the FTX collapse.
Cowen & Co downgraded Coinbase from ‘Outperform’ to ‘Market Perform’ and reduced the price target from $75 to $36, citing uncertainty surrounding trading volumes and increased potential for SEC enforcement. Cowen noted that Coinbase generates a majority of its revenue from transaction fees, which means its business is highly correlated to crypto prices, trading volumes, and volatility.
Interestingly, crypto prices have been on the rise over the last week. Bitcoin BTC/USD has recorded 1.42% returns in the last five days while Ethereum ETH/USD has gained 4.53%.
Major Sale: ARK sold 403,990 shares of Silvergate Capital Corp SI on Thursday at an estimated valuation of over $5 million. Silvergate shares closed 42.73% lower and lost another 2.23% in extended trading on Thursday after it released its preliminary fourth-quarter results that showed a significant drop in customer deposits. Digital asset deposits decreased from $11.9 billion at the end of the third quarter to $3.8 billion, representing a decline of approximately 68%.