Cathie Wood, CEO of the Ark investment fund, makes a new prediction and buys back bitcoin (BTC), or rather GBTC. In 2021, she predicted bitcoin at $500,000. Now she aims for a million. The fall of bitcoin (BTC), well below 20,000 dollars, and the ongoing disasters did not shake the optimism of Cathie Wood, a great figure in investment. She bought back 176,945 shares in the Grayscale Bitcoin Trust Fund (GBTC).
Who is Cathie Wood?
Cathie Wood, born in 1955, has 40 years of experience in finance: she is an investment star. She is the founder and manager of ARK Invest, whose assets under management are equal billions of dollars. In 2021, she predicted bitcoin (BTC) at $500,000. Now she predicts that it will reach a million in 2030. Cathie Wood is recognized as a highly influential money manager: her company invests in stocks that she estimates will double in value over five years. The Ark Invest fund has recorded an average annual return of almost 45% for the past five years. So Cathie Wood’s opinion is especially followed and her two recent purchases of GBTC show a very positive sign for bitcoin (BTC).
Ark and bitcoin investments with Grayscale sauce: GBTC
Ark publishes its investments on its site, and we can clearly see the last two in GBTC, on November 15 and 22, 2022. In total, Ark now has almost. 6.357 million GBTC shares, which represents 0.4% of the company’s total investments. The current value of his GBTCs is estimated at $55 million. GBTC shares trade at a 45% discount below their net asset value. Probably a bold bet, as Grayscale currently refuses to disclose its reserves as the crypto exchanges currently do. Grayscale is said to be the world’s largest bitcoin holder (after Satoshi Nakamoto) and would not be in trouble despite the difficulties of his Genesis subsidiary, which has $175 million locked up on FTX and a billion to rescue its accounts. .
Does Grayscale really have 634,000 bitcoins?
Launched in September 2013, GBTC is a security that offers certain investment funds a way to gain exposure to bitcoin without actually buying it. So Grayscale holds the bitcoins (or not?) and its investors don’t. After the fall in GBTC shares, many investors are questioning the management of their funds, and Grayscale he published a press release on November 18 to reassure them.
The Digital Currency Group is Grayscale’s parent company and has already repurchased GBTC shares as the SEC document shows us: Authorized by Digital Currency Group, Inc. (“DCG”), the parent company of Grayscale Investments, LLC, purchased shares of Grayscale Bitcoin Trust (OTCQX: GBTC) for a total value of $1 billion. “. (October 2021).
We can therefore legitimately wonder if the parent company, which also owns Genesis and Coindesk (among others), does not buy its shares to support the course (in vain). If Grayscale were to sell bitcoin to support Genesis, then one would expect a crash in the price of bitcoin.
Is Cathie Wood making the right choice buying GBTC en masse at discount prices? His fund would be the largest holder of GBTC (after DCG). Does he buy back to support the course? Since the incredible fall of FTX, unimaginable not long ago, we no longer know who to trust… Does Grayscale still have that many bitcoins? Will we have to sell it to save Genesis? We are literally living in a real soap opera, exciting, but also affecting many small investors. The bear market is likely to be long, very long…
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Subprime, financial crises, galloping inflation, tax havens… Bitcoin was designed for more transparency and maybe finally change the situation. I try to understand this new environment and I try to explain it to myself. The road is undoubtedly long, but it is worth it.