"Ark bearish on Bitcoin, selling off GBTC? Bloomberg analyst: To maintain fund weight"

In recent times, the community's anticipation for a Bitcoin spot ETF has led to a continuous rise in Bitcoin's price, and this has also resulted in a significant reduction in the discount of Grayscale's flagship fund GBTC. However, Ark Invest, which has always been bullish on Bitcoin, has been continuously selling GBTC since August. Could it be that they believe this rally has gone too far and it's time to take profits? Bloomberg analyst Eric Balchunas suggests that this is because of the significant surge in GBTC, forcing Ark to sell in order to maintain the fund's weight.

Just saw another article on how ARK is selling GBTC and how that means they aren’t really bullish btc and/or they making room for ARKB. Neither is true. With ARK you gotta look at weightings history bf you begin your interpretation. FYI https://t.co/GJL6RWKvK2

— Eric Balchunas (@EricBalchunas) November 27, 2023

GBTC Maintains 9% Weight

Balchunas stated that he is not defending ARK's BTC predictions, but rather Ark likes to sell winners and buy losers to maintain the required weight in its portfolio. As GBTC has risen by 76% since August, ARK must sell to maintain around 9% weight.

GBTC has consistently been among the top three holdings of Ark's ARKW fund, with a weight of 9.15%, while the top holding Coinbase with the code COIN stands at 10.88%, according to its official website.

According to ArkTrace data, ARKW has sold 1.29 million shares of GBTC since August, amounting to approximately $32.25 million based on an average price of $25 per share. The ARKW currently has a net asset value of $1.141 billion.

ARKW Up 70% Year-to-Date

ARKW is up 70% year-to-date. GBTC is up 220% year-to-date. Meanwhile, Bitcoin has risen by 125% during the same period.