- Cathie Wood Ark Investment purchased 6.4 million GBTC shares during the bear market.
Ark Investment Management, an American Investment Management Company, was established by Cathie Wood, who is currently serving as the Chief Executive Officer in the firm.
According to recent news on November 21, 2022, Ark Investment purchased 176,945 shares of Grayscale Bitcoin Trust(GBTC). The purchasing of shares continued as the prices of the GBTC shares decreased by a 45% discount to their net assets.
Grayscale Bitcoin Trust, which trades under the name GBTC, is an investment vehicle that acts the same way as a stock, in which each piece of share depicts a particular portion of Bitcoin (BTC). It was formed in 2013 to transform into an exchange-traded fund (ETF) in over-the-counter markets.
Many market analysts believe that the prices of GBTC shares decreased because of the FTX collapse and the negativity spread in the crypto market. Still, some believe that Bitcoin’s lowest trading price of 2022 has affected the prices.
On Monday, Ark investment purchased GBTC shares worth $1.5 million, and last week the company invested $2.8 million in purchasing the shares of GBTC.
Currently, Ark Investment holds approximately 6.4 million GBTC shares worth $53 million. The discount continued over the day, and on Tuesday, the stock price traded at 42% more than its original price.
Genesis is facing liquidity issues for its lending book, and if it proceeds to file for bankruptcy, the creditors cannot claim the assets of GBTC. According to the report, it means that GBTC is indirectly affected by Genesis.
Although several other institutions in the crypto sector are in great trouble, the reason behind the trouble is predicted as FTX collapse, crypto winters and BlockFi withdrawals halting.
According to the reports in the second week of August 2022, Ark sold Coinbase stakes just after SEC rolled out a report probing the crypto exchange around certain security listings.
Wood continued mentioning several risk factors involved with Coinbase. The ETF manager of Ark sold approximately 1.1 Million shares on a normal trading day, which was very little.
According to Ark’s data, the company still stands as a major shareholder with five million Coinbase shares. Ark opted to sell out the share amid the SEC probe report on Coinbase.
Grayscale is among the biggest bitcoin holder and holds around 3 percent of the overall circulating supply of Bitcoin.
Last week, Genesis Global Capital was reported to face a liquidity crunch after the bankruptcy filing of FTX. The FTX collapse was a two-way hit for the firm: the abrupt withdrawals of assets by users and debt to FTX-affiliated Alameda Research.
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