This article first appeared on GuruFocus.
Shares of Circle Internet Group (NYSE:CRCL) dropped about 12% on Wednesday, but that didn’t stop Cathie Wood’s ARK Invest from buying the dip. The investment firm picked up nearly $30.5 million worth of Circle shares across three of its exchange-traded funds.
The ARK Innovation ETF (ARKK) purchased around 245,800 shares, while the ARK Next Generation Internet ETF (ARKW) added roughly 70,600, and the ARK Fintech Innovation ETF (ARKF) took in about 36,900 shares.
The buying spree came just after Circle reported better-than-expected third-quarter results. The company, best known as the issuer of USCoin (USDC-USD), posted $740 million in revenue, up about 66% year over year, and net income of $214 million, more than triple last year’s figure. USDC’s circulation also grew sharply to $73.7 billion, more than double the level from a year ago.
Even with the strong numbers, some investors worry that Circle’s business is still too tied to reserve-based income, which makes up nearly 96% of total revenue. If interest rates fall, that could hit profits. Still, ARK’s latest move shows it’s betting that Circle’s long-term potential in fintech and stablecoins outweighs short-term headwinds.