Cathie Wood Dumps 1.4 million Shares of Coinbase Stock

The move comes after the recent probe by the SEC into Coinbase, which clearly influenced Wood in her decision to have her flagship Ark Innovation ETF sell COIN at an estimated cost average of $254.65.

Coinbase

Cathie Wood, the renowned tech investor, sold 1.4 million shares of Coinbase Global (COIN:NASDAQ) on Tuesday (July 26)- her first sale of stock in the cryptocurrency exchange operator this year.

This move comes after the recent probe by the Securities and Exchange Commission (SEC) into Coinbase, which clearly influenced Wood in her decision to have her flagship Ark Innovation ETF sell COIN at an estimated cost average of $254.65.

The SEC charged a former Coinbase product manager, who has been arrested and is also facing criminal charges, with insider trading, while also claiming that some of the tokens – nine, to be precised – listed on Coinbase were unregistered securities- which Coinbase has denied.

“I’m happy to say it again and again: we are confident that our rigorous diligence process — a process the SEC has already reviewed — keeps securities off our platform,” Coinbase’s chief legal officer Paul Grewal said on Twitter, adding that the company is looking forward “to engaging with the SEC on the matter.”

The cryptocurrency world is embroiled in a heated debate over how to classify crypto tokens. On one side are those who argue that tokens should be classified as commodities, like other kinds of currency. This camp believes that governing cryptocurrencies through the Commodity Futures Trading Commission would provide more clarity and stability in the market.

On the other side are those who believe that tokens should be classified as securities. This faction points to the fact that many crypto projects are funded by the sale of tokens whose primary value is speculative. SEC Chair Gary Gensler has said that “many of these underlying tokens have the attributes of securities” and need to be regulated to protect investors.

The truth is, there is no easy answer when it comes to classifying cryptocurrencies. However, it is clear that whatever decision is made, and let’s not forget here also Ripple’s ongoing lawsuit from SEC, will have a major impact on the future of the industry.

Despite this turbulence, Coinbase shares still rose 4% to $55.21 in Wednesday’s premarket trade. Coinbase stock however, has lost 56% over the last 3 months, and more than 79% year-to-date.

It will be interesting to see if Wood continues to back Coinbase through these tough times or if she cuts her losses and moves on to other investments.

h/t MW

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