Ark Invest, Cathie Wood’s asset management giant, is optimistic about the future of Coinbase stock, forecasting better performance now that FTX, one of its principal competitors in the crypto space, has imploded.
The asset manager disclosed this deep-seated optimism in the future performance of Coinbase (COIN) through its report for the fourth quarter of 2022. The report was shared with crypto. news reveals a massive underperformance from all its six active ETFs in Q4 2022, two of which had COIN among the top two detractors.
Ark Invest persistently added more COIN to its bags throughout Q4 2022, substantially increasing its exposure. The pattern spilled into the new year. The asset manager purchased 78,982 COIN shares in mid-December, bringing the total COIN holdings in ARKK to 5.7 million shares.
Shortly after, Ark Invest amassed another batch of 158,000 COIN shares worth $5 million on Dec. 30, leading to a substantial increase in the COIN holdings of its ARKF ETF. These purchases ensued, notwithstanding COIN’s 45% decline in Q4 2022. Twelve days into the new year, the asset management firm purchased $5 million worth of COIN in 48 hours.
COIN’s poor performance last year was further exacerbated by the overall bear market and the company’s unique troubles, triggering the layoff of 1,100 employees in 2022.
Despite a promising start to the year, Coinbase let go of an additional 950 employees last week. The firm also suspended operations in its Japanese unit yesterday. Meanwhile, its stock has surged by 42% in the past month.