Ark Invest backs Circle with $14M despite downgrade

Cathie Wood’s Ark Invest purchased 220,012 shares of Circle Internet Group on Tuesday, a position valued at roughly $13.9 million based on the day's closing price of $63.22. The crypto-focused asset manager spread the acquisition across three of its exchange-traded funds: ARKK, ARKW, and ARKF. This sizable accumulation arrives precisely as traditional Wall Street sentiment toward the stablecoin issuer deteriorates.

Circle’s stock has dropped 24.17% over the past month following the early July launch of Open USD, a competing stablecoin project. The competitive pressure prompted Mizuho analysts to downgrade Circle to Underperform from Neutral and slash its price target to $50 from $85. Ark’s decision to build a substantial position against this institutional pushback signals a high-conviction bet that the market has overpriced the competitive risk.

The firm also continued to build its exposure to adjacent digital asset infrastructure. Ark added 19,029 shares of Block Inc., the blockchain-focused fintech co-founded by Jack Dorsey, through its ARKW and ARKF funds. This investment was worth roughly $1.52 million at Block's closing price of $79.99, a 1.61% gain for the session.

To fund these additions, Ark trimmed its position in a high-performing asset. The firm sold 27,742 shares of Robinhood Markets, liquidating about $3.15 million as the trading platform's stock climbed 3.27% to close at $113.45.

These simultaneous trades highlight a routine but critical dynamic for investors tracking actively managed ETFs. Ark maintains a strict mandate that no single stock can exceed 10% of a fund's total portfolio weight, forcing mechanical rebalancing when holdings rally. The firm locks in profits from appreciating assets like Robinhood and reallocates capital into underperforming names to maintain risk limits while executing a contrarian strategy.