Ark Invest buys $5.2 million of Circle shares, sells $15.9 million of its own Bitcoin ETF as BTC grinds lower

Cathie Wood-led Ark Invest bought 65,615 Circle shares, worth $5.2 million, for its Next Generation Internet exchange-traded fund (ARKW) on Monday and offloaded $15.9 million worth of its own spot Bitcoin exchange-traded fund ARK 21Shares Bitcoin ETF (ARKB) from two of its investment funds as the foremost cryptocurrency continued its slump from its early October highs.

Ark's investment strategy involves letting no individual holding take up more than 10% of a fund's portfolio. This is to maintain diversification within its funds — meaning Ark is likely to continue rebalancing its weightings if the value of certain shares rise or fall significantly relative to the firm's other fund holdings.

As of Oct. 27, Circle Internet Group, Inc. (CRCL) is currently the fifth-largest holding within its ARKW fund, with a weighting of 4.3%, worth around $67.8 million, according to Arl's latest disclosures. Tesla, Meta, Shopify, and Amazon make up the remainder of ARKW's top five holdings, respectively.

Circle shares fell 7.1% on Monday, closing at $79.84 and trading down 1.2% year-to-date, according to The Block's CRCL page. The stock is currently down 1.1% in pre-market trading on Tuesday, per TradingView.

ARKB remains top 10 allocation as bitcoin slumps

The Ark Invest/21Shares ARKB Bitcoin ETF remains a top 10 allocation within Ark Invest's Next Generation Internet fund and ARK Blockchain and Fintech Innovation ETF (ARKF), with a weighting of 3.7% and 3.8% and valued at approximately $58.2 million and $29.1 million, respectively.

Ark's spot Bitcoin ETF has generated around $1.1 billion in net inflows since launching in January 2024, with $2.5 billion in assets under management, according to The Block's ETF Tracker page.

Bitcoin Bitcoin (BTC) was trading around $79,625 on Tuesday morning, remaining below the $80,000 mark amid renewed selling pressure ahead of Wednesday's Federal Reserve interest rate decision. The largest cryptocurrency has now pulled back 8.7% since its October high of around $87,200.

Joel Kruger, market strategist at LMAX Group, highlighted growing tensions in the Middle East, higher oil prices, and uneven institutional demand as reasons for the crypto market's recent weakness. Thin weekend trading and leveraged liquidations added to the selling pressure, Kruger told The Block, though he argued that the market decline was being driven more by macroeconomic factors than a fundamental change in the outlook for digital assets.

Meanwhile, Nick Forster, founder and CEO of crypto options platform Derive, told The Block that traders were increasingly positioning for further downside, with $80,000 becoming the most actively traded bitcoin options strike on the exchange. Put options accounted for 91% of the roughly $32 million traded at that level over the past week, reflecting growing demand for protection against further price declines.