What happened?
Cathie Wood’s ARK Invest sold a significant portion of its shares in Circle, offloading $44.7 million worth on June 17, bringing the total for the past two days to nearly $100 million. This sale represents over 640,000 shares, accounting for about 14% of ARK’s original stake in Circle. The move has raised questions regarding the firm’s confidence in Circle and the broader cryptocurrency market amidst growing geopolitical tensions.
Who does this affect?
The sale impacts investors and stakeholders in Circle, particularly those involved in the cryptocurrency market and stablecoin sector. It also affects ARK Invest’s ETF holders, as the company divested shares across its flagship funds ARKK, ARKW, and ARKF. Additionally, market observers and potential investors in Circle are paying attention, especially since other major backers have not yet reduced their exposure.
Why does this matter?
This divestment by ARK Invest could indicate a lack of confidence in the future performance of Circle, potentially affecting the perception and valuation of stablecoins. The sell-off occurred despite positive legislative developments, suggesting caution in the crypto market amid geopolitical tensions. The market impact is evident, as Circle’s stock experienced a dip following the sales, and the broader crypto market is sensitive to such significant movements from institutional investors.