Profit of over 200 million dollars in 2 months, ARK Invest's encryption timing strategy.

Written by: Prathik Desai

Compiled by: Luffy, Foresight News

Over the past few months, I have been tracking ARK Invest's daily trading activities related to cryptocurrency companies. This American fund management company manages several ETFs and assets under a venture fund. Their buying and selling strategies reveal an interesting phenomenon: how they are able to time their trades accurately in this seemingly difficult-to-navigate field.

One operation might be a coincidence, twice perhaps an intuition, but ARK's crypto trading demonstrates an unusual sense of timing. This is intentional, not a passive reaction. The evidence is that just in June and July, by trading stocks of Coinbase and Circle, they achieved over $265 million in profits.

Upon closer observation, it can be found that ARK is withdrawing funds from exchanges and trading platforms, shifting towards infrastructure, asset reserves, and so on.

Recent transactions by ARK allow us a glimpse into how one of the most watched institutional investors optimizes returns for its crypto investors through quick and often precise timing of entry and exit. This is in stark contrast to the crypto realm's narrative of "diamond hands" (long-term holding), and is more complex and sophisticated.

On June 5, 2025, Circle, the issuer of the largest compliant stablecoin USDC, was listed on the NYSE with an issuance price of $69. ARK, as a cornerstone investor, purchased 4.49 million shares through its fund, with a total value of approximately $373 million.

On June 23, Circle's stock price peaked at $263.45, which means Circle's market capitalization is approximately $60 billion, equivalent to 100% of its assets under management (AUM) at that time. This may be due to the market's optimistic attitude towards the future of stablecoins and attempts to estimate Circle's long-term revenue at 10 times its current AUM. However, compared to the valuations of traditional asset management companies, this seems overly exaggerated. For reference: BlackRock manages $12.5 trillion in assets, yet its market value is slightly above $180 billion, approximately 1.4% of its AUM. This is a signal for ARK.

Daily trading documents show that as Circle's stock price premium skyrockets, ARK systematically sells its shares through multiple funds.

ARK began selling shares a week before Circle's stock price peaked, selling a total of about 1.5 million shares (33% of its total holdings), cashing out approximately $333 million during the parabolic rise in stock price. This realized over $200 million in profit compared to when ARK built its position, with a return rate of 160%.

ARK's interest in popular IPOs doesn't stop there.

Last week, they purchased 60,000 shares on the first day of Figma's listing. The San Francisco-based design software company disclosed in SEC filings that it holds $70 million in Bitcoin ETFs and has been approved to purchase an additional $30 million.

Figma's stock price surged over 200% on its first day of trading, closing at $115.50, with an increase of 250%. On the second day, Figma's stock price rose another 5.8%.

ARK's recent trades on Coinbase further reveal its systematic profit-taking pattern.

As of April 30, 2025, ARK held 2.88 million shares of this largest US cryptocurrency exchange. Thereafter, they systematically took profits by the end of July.

At the same time, as Bitcoin hit a historical high of over $112,000, Coinbase's stock price also rose, briefly surpassing $440 and setting its own historical high. On July 1, ARK sold $43.8 million worth of shares; on July 21 (the day Coinbase's stock price peaked), ARK reduced its holdings by $93.1 million through three funds. Between June 27 and July 31, ARK sold a total of 528,779 shares (about 20% of its total holdings) worth over $200 million, with an average selling price of $385 per share. In comparison, ARK's weighted average cost for acquiring Coinbase shares over the past four years is about $260, resulting in profits of over $66 million from these trades.

In the past two months, Coinbase is no longer the top holding in ARK's portfolio.

After the market closed on July 31, Coinbase's second-quarter performance disappointed investors, leading to a 17% drop in share price the next day, from about $379 to $314. On August 1 (the day of the plunge), ARK bought $30.7 million worth of Coinbase shares.

These transactions are not isolated events, but rather part of a strategic shift that moves funds away from the overheated cryptocurrency exchange ecosystem and towards areas that have just begun to attract widespread attention.

While selling off Coinbase stock, ARK also reduced its holdings in its competitor Robinhood. Both of these reductions coincide with ARK's substantial investment in BitMine Immersion Technologies, which is referred to as the "Ethereum version of MicroStrategy." BitMine, led by Wall Street veteran Tom Lee, is building an Ethereum reserve with the goal of holding and staking 5% of the total Ethereum supply.

On July 22, ARK invested $182 million in BitMine through a block trade. However, they did not stop there, and systematically bought in during every significant pullback, accumulating over $235 million in just two weeks.

These transactions indicate that ARK is shifting from cryptocurrency exchanges and payment companies to what is known as the cryptocurrency infrastructure sector. Coinbase and Robinhood profit from people's cryptocurrency trading, while BitMine profits by directly holding cryptocurrencies. Both approaches can capture the benefits of cryptocurrency adoption, but they have different risk characteristics.

Exchanges benefit from market volatility and speculative behavior. When cryptocurrency prices fluctuate dramatically, trading activity increases, leading to higher exchange revenues, but this is cyclical. Reserve-based companies like BitMine directly benefit from rising cryptocurrency prices; if Ethereum rises by 50%, BitMine's assets will also rise by 50%, independent of trading volume or user behavior. Even without significant capital appreciation, staking Ethereum on the network can generate stable income.

But high returns come with high risks: reserve-type companies also face direct downside risks. When the price of Ethereum falls, the asset value of BitMine will also shrink proportionally, which makes the beta value (risk coefficient) of the reserve strategy higher.

ARK's transactions reflect its belief in cryptocurrency: cryptocurrencies are moving from speculative trading markets towards maturity, closer to permanent financial infrastructure. In such a world, holding underlying assets may be more valuable than holding the platforms that trade these assets.

The interesting thing about these trades is the precision of timing. They sold all the way up during Circle's dream rally until it peaked; they captured a 250% gain during the Figma IPO; they sold at the peak of Coinbase and then added to their positions after its disappointing earnings collapse; they bought during multiple pullbacks in BitMine.

The ARK methodology combines traditional value investing principles with precise timing: when Circle's market capitalization reaches 100% of its managed assets, it may be overvalued; when Coinbase drops 17% in one day due to performance falling short of expectations, it may be undervalued. ARK also seems to engage in timing trades around predictable events (earnings releases, regulatory decisions, market fluctuations).

There is another key question: why do these stocks have such a huge premium compared to their underlying assets? Circle's market value once matched the scale of the assets it managed, and BitMine's stock price also had a multiple premium compared to the value of the Ethereum it held. This premium exists largely because most investors cannot easily buy cryptocurrencies directly; even if they can, the experience of depositing and withdrawing on platforms is not smooth enough for retail investors. If you want to allocate Ethereum in your pension to gain its appreciation benefits, buying stocks of companies that hold Ethereum is much easier than buying Ethereum directly.

This creates a structural advantage for companies holding crypto assets. ARK's trading indicates that they are well aware of this situation: buying when the premium is reasonable and selling when the premium is too high.

ARK's strategy proves that investing in crypto stocks is not necessarily as simple as buying and holding, especially when you want to optimize returns. For anyone trying to track ARK's crypto trades, simply knowing what they bought is not enough; it's also important to understand why they bought it, when they might sell, and what they will turn to next.