ARK Increases Holdings in Crypto Stocks: Analysis of Fund Flows After Sector Correction
Key points
ARK Investments bucked the trend by increasing its holdings in crypto-related stocks such as Circle and Bullish during a significant correction in the cryptocurrency sector (BTC fell from $126K to $87K), investing a total of approximately $93M, demonstrating its long-term confidence in crypto infrastructure. On-chain data shows funds flowing from USDC to USDT, while technical analysis suggests that BTC is showing signs of accumulation at current levels, indicating a potential resurgence of funds into core crypto assets.
ARK Investment Increase Details
Recent transaction details
| date | stock | Number of shares purchased | value | ETF | Market performance |
|---|---|---|---|---|---|
| November 25 | CRCL | ~215K | $7.6M | ARKK/ARKW | It fell 3.6% that day. |
| November 25 | BLSH | ~37K | $1.5M | ARKK/ARKW | It fell 2.4% that day. |
| November 25 | COIN | 15,197 | $3.86M | ARKK/ARKW | Monthly decline of ~30% |
| November 26 | COIN | 62,166 | $16.5M | ARKK/ARKW/ARKF | It rose 4.3% that day. |
Total investment : Approximately $93 million was invested between November 20th and 26th, covering crypto-related assets such as Circle, Bullish, Block, Coinbase, Robinhood, and ARKB. (coindesk)
ARK Strategy Interpretation
Cathie Wood views this pullback as a "generational opportunity," believing the story of AI and cryptocurrency convergence is just beginning. ARK currently holds approximately $506 million in COIN (4% of AUM) and approximately $255 million in CRCL (2% of AUM), demonstrating strong confidence in crypto infrastructure. (thestreet)
On-chain fund flow analysis
Stablecoin liquidity model
Comparison of USDC vs USDT fund flows :
| Stablecoins | Weekly net flow | Reserve changes | Market position |
|---|---|---|---|
| USDC | -1.05B | Reserves decreased from $14.71 billion to $13.98 billion (-5%). | Market capitalization of $74 billion, under significant pressure. |
| USDT | +1.1B | Reserves remain stable at ~$59B | Market capitalization of $184 billion, the top choice for funds. |
Data shows that investors are more inclined to use USDT due to risk aversion, while USDC is facing net outflow pressure. The total market capitalization of stablecoins contracted by $6 billion in November, reflecting tight liquidity.
Exchange traffic changes
BTC exchange net outflow : Over the past 7 days, a total net outflow of approximately 395,000 BTC has occurred, with the peak of 369,000 BTC outflow on November 22nd. Exchange BTC reserves have decreased from 2.37 million to 1.83 million (-23%), indicating a strong accumulation signal.
Binance USDC movement : Binance USDC saw a large outflow, totaling approximately -1.1B, including -389M on November 20 and -347M on November 25, indicating that users converted USDC into other assets or fiat currency.
Technical Analysis and Accumulated Signals
BTC Technical Indicators
| Timeframe | RSI(14) | MACD | Trend Judgment | Key position |
|---|---|---|---|---|
| 1 hour | 72.9 (Overbought) | +247 (Bullish Crossover) | 🟢 Strong short-term upward trend | Resistance at $95,398 |
| 4 hours | 67.6 (Slightly high) | +473 (Strong bullish outlook) | 🟡 Kinetic energy accumulation | Support at $88,057 |
| Daily chart | 40.7 (Neutral) | +327 (mild bullish divergence) | 🔴 Below key moving average | Support at $87,562 |
Current price : $91,190, near a key technical level. Continued net outflows from exchanges and declining reserves support the accumulation hypothesis.
Derivatives Market Indicators
- Open interest rose 3.94% to $61.5 billion in the last 24 hours, indicating an increase in leveraged long positions.
- Funding rates : Most are negative (e.g., Binance -0.0044%), meaning short sellers pay long positions, supporting bullish sentiment.
- Support level : $88,057 (SMA50) is a key support level; if it holds, it may challenge the resistance level of $95,398.
Social sentiment and market expectations
Discussions on Twitter/X generally interpret ARK's increased holdings as a vote of confidence from institutions in the crypto infrastructure sector. Key narratives include:
- Buy on dips strategy : The community believes that ARK's "buying on dips" behavior indicates that a bottom has formed in the sector.
- Infrastructure investment : Focusing on investments in Circle (stablecoin) and Bullish (exchange) is seen as a core part of betting on the crypto ecosystem.
- Fund rotation expectations : Users anticipate funds will shift from high-risk tokens to BTC and crypto stocks with clearer regulations.
Fund Flow Forward
Short-term flow (1-4 weeks)
- Stablecoin consolidation period : USDT will continue to benefit from safe-haven demand, while USDC may rebound after Circle's financial report improves.
- BTC Re-accumulation : Technical Analysis and On-Chain Data Support Accumulation Behavior in the $88K-$95K Range
- Crypto stocks are bottoming out : COIN, CRCL, and others may see institutional investment after valuation compression.
Medium- to long-term trends (1-6 months)
Potential inflow directions :
- BTC ETF : Despite a net outflow of $3.5 billion in November, long-term institutional demand for allocation remains.
- Crypto infrastructure stocks : Circle, Coinbase, and others benefit from clearer regulations and the trend of AI integration.
- DeFi Blue Chips : TVL Rebound May Drive Price Recovery of Related Tokens
Risk factors :
- Fed rate hike expectations in December (CME indicates 80% probability of rate cut)
- Regulatory policy uncertainty
- Institutional redemption pressure continues
in conclusion
ARK's contrarian buying during the crypto sector's pullback reflects strong confidence in the long-term trend. Current data shows that funds are undergoing a defensive rotation from high-risk assets to stablecoins (mainly USDT) and BTC. Technically, BTC has found support around $88K, coupled with continued outflows from exchanges, indicating the start of a new accumulation cycle.
Investors should pay attention to whether BTC can hold its key support level, as well as the performance of ARK's heavily invested stocks such as Circle and Bullish during the Q4 earnings season, which will provide important clues for judging the flow of funds.