Cathie Wood says this crypto crash is a huge opportunity, she still sees Bitcoin soaring 6,000% to $1 million – here are her 3 bets from the big sector

‘You have to go through crises’: Cathie Wood says this crypto crash is a huge opportunity, she still sees Bitcoin soaring 6,000% to $1 million – here are her 3 big sector bets

It probably doesn’t feel good to be a crypto investor these days. Bitcoin is down 65% year to date. And some say this is not a “crypto winter” but a “crypto extinction”.

One expert remains hopeful: Cathie Wood of Ark Invest.

When asked if she still has her bitcoin forecast of $1 million per coin by 2030 during an interview with Bloomberg, her answer was “yes.”

“Sometimes you need to test a fight, you need to go through crises to see the survivors first hand,” she says.

Don’t lose

Wood admits that the ongoing crypto crisis could slow down institutional adoption, but he still reckons that bitcoin will come out “smelling like a rose”.

“Once they do the homework and see what’s happened here, I think they might be more comfortable moving into bitcoin and maybe ether as a first stop.”

Considering that bitcoin is currently trading at around $16,400, its $1 million price target suggests a potential upside of 5,998%.

As always, Wood is putting her money where her mouth is. Here’s a look at how the super investor is betting on crypto.

Grayscale Bitcoin Trust (GBTC)

With the rise of bitcoin over the past several years, many bitcoin funds have entered the market. Bitcoin Trust Greyscale is one of them.

According to GBTC, its shares aim to reflect the value of its bitcoin holdings, minus fees and expenses. The fund says it has not met this objective because its shares are trading at a premium or discount to that value which has been “at times substantial”.

Year to date, GBTC shares have fallen 75%.

The bankruptcy of cryptocurrency exchange FTX has sent shock waves throughout the crypto space and that is one of the reasons why investors are unloading GBTC shares. As a result, GTBC trades at a deep discount to its underlying asset – bitcoin.

That discount caught Wood’s attention. Ark Investment Management reportedly cut 176,945 shares of GBTC on Monday, which are worth about $1.5 million.

Coinbase Global (COIN)

If you’ve ever bought bitcoin from an exchange before, you know that there are usually transaction fees involved. And as more people rushed to buy cryptocurrencies, these transaction fees quickly increased.

That’s where Coinbase found its opportunity. As the largest cryptocurrency exchange in the US, it earns a transaction fee every time someone buys or sells cryptocurrency on its exchange.

Read more: Trade up when the market is down: Here are the best investment apps to find ‘once in a generation’ opportunities (even if you’re a beginner)

In Q3, Coinbase had 8.5 million monthly transaction users. It earned $366 million in transaction revenue and $211 million in subscription and services revenue.

Given the downturn in cryptocurrencies, it’s no surprise that Coinbase shares have also seen heavy volatility – they’re down a painful 82% in 2022.

But the company remains in Wood’s portfolio. The main fund Ark Invest Ark Innovation ETF (ARKK) holds more than 5.9 million shares of Coinbase, which is worth about $257.1 million.

Block (SQ)

Wood’s Ark Innovation ETF also owns 6.26 million shares of Block, a digital payments technologist formerly known as Square.

With a stake valued at $392.7 million, Block is currently ARKK’s fifth largest holding.

The management changed the name last December because “Cairnó” was synonymous with the company’s vendor business. But the move did little to encourage investors. In 2022, shares fell more than 60%.

Although the company is far from your favorite market right now, it continues to deliver some very impressive numbers.

In Q3, total net income rose 17% year over year to $4.52 billion. Gross profit came in at $1.57 billion, up 38% from a year ago.

The company is also a cryptocurrency play: for the quarter, Block generated $1.76 billion of bitcoin revenue and earned $37 million of bitcoin gross profit.

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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

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