Cathie Wood's ARK Invest Sold Coinbase Shares Following SEC Investigation

Cathie Wood, the founder and CEO of ARK Investment Management, revealed that her firm sold "very little" shares of Coinbase (COIN) in July due to "uncertainty" regarding crypto regulations and listings posed by the SEC's investigation of the exchange.

In an interview with Bloomberg TV on Monday, Wood stated that it was unclear how many listings on Coinbase could be considered securities by the U.S. Securities and Exchange Commission and what changes the investigation would bring to the exchange's business model.

Hence, the ARK Invest CEO confirmed that the investment management firm "swapped" COIN shares with the shares of Shopify Inc. which were also bearish at that time.

As per ARK's daily trading data compiled by Bloomberg, three of ARK Invest's exchange-traded funds (ETFs) sold around 1.41 million shares of COIN on July 26. The worth of these shares was around $75 million at that time.

The holding data from ARK shows that it currently holds around $452 million worth COIN shares which comes out to be around 4.8 million shares based on the price of COIN as of 4:00 p.m. ET Monday, i.e., $98.02, according to NASDAQ.

Wood also pointed out that the introduction of the insider trading case against an ex-Coinbase product manager by federal prosecutors was another red flag for the investment management firm.

Coinbase's stock has started to perform quite well in the recent period following the announcement of a partnership with asset management firm BlackRock (BLK) on Aug. 4. According to Coindesk, ARK analyst Yassine Elmandjra alluded that the investment management firm is still bullish on Coinbase.

"BlackRock's decision to partner with Coinbase is a strong signal that institutions consider crypto – starting with bitcoin [BTC] – a new asset class. We agree that bitcoin has earned an allocation into well diversified portfolios," the analyst said in a note.