Cathie Wood’s ARK Invest recently sold $51.8 million in Circle (CRCL) shares as the stock surged amid a strong post-IPO rally. The fund offloaded 342,658 shares across three ETFs: 196,367 shares from ARK Innovation ETF (ARKK), 92,310 from ARK Next Generation Internet ETF (ARKW), and 53,981 from ARK Fintech Innovation ETF (ARKF).
Circle’s stock has soared dramatically since its June 5 debut on the NYSE at $31 per share. The price has climbed nearly fivefold, reaching a peak intraday high of $165.60 on June 16 and closing at $151.06, marking a 13% gain on that day alone. Overall, Circle’s shares have surged approximately 434% from the IPO price within less than two weeks.
This remarkable rise reflects growing investor enthusiasm for stablecoins, digital currencies backed by reserve assets like the U.S. dollar. Circle is the issuer of the USDC stablecoin, which has become the second-largest stablecoin by market circulation, with billions of dollars in tokens outstanding. The company’s revenue mainly comes from “reserve income,” generated by cash reserves supporting USDC.
ARK Invest initially bought $373 million worth of Circle shares on the first day of trading, and despite the recent sale, it still holds over 4 million shares valued at about $373 million, sitting on paper gains of roughly $185 million. The sale appears to be a profit-taking move amid the stock’s rapid ascent rather than a loss of confidence.
Circle’s CEO Jeremy Allaire has suggested that stablecoins are approaching their “iPhone moment,” signaling a transformative phase where programmable digital dollars become foundational financial platforms.
This optimism is supported by expected U.S. Senate legislation aimed at regulating stablecoins, which could provide greater clarity and boost institutional adoption.
Financially, Circle reported strong fundamentals with $1.67 billion in revenue, a 15.5% pretax profit margin, and robust cash flow, including $61.3 billion in cash holdings.
These metrics underscore the company’s solid position and growth potential in the fintech sector.
In summary, Circle’s stock rally is driven by its leadership in the stablecoin market, strong financials, regulatory momentum, and growing investor interest. ARK Invest’s recent share sale reflects strategic profit-taking amid this rapid growth phase.
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