Cathie Wood’s ARK Invest is showing continued confidence in Circle Internet Group, the company behind the USDC stablecoin, despite a sharp decline in the firm’s share price since its market debut.
The investment firm has continued increasing its exposure to Circle, signaling that it believes the long-term potential of the stablecoin issuer outweighs recent market concerns.
ARK Adds Nearly $14 Million in Circle Shares
According to ARK Invest’s daily trade disclosures, the firm purchased an additional 220,000 shares of Circle across three actively managed exchange-traded funds on Tuesday.
Based on Circle’s closing price of $63.22 on the New York Stock Exchange, the purchase was valued at approximately $13.9 million.
The move comes as Circle shares remain under pressure, falling about 22% since the beginning of the year and sitting roughly 76% below their post-IPO high.
Investment Firm Continues Building Circle Position
The latest purchase adds to a series of Circle acquisitions made by ARK throughout July.
The firm has now disclosed purchases totaling 725,517 Circle shares this month, following earlier acquisitions of 287,609 shares on July 1 and another 217,896 shares on July 9.
The repeated buying activity highlights ARK’s continued belief in Circle’s business model despite the stock’s extended decline.
Circle Becomes a Major Holding Across ARK Funds
Circle has grown into a notable position across several of ARK’s investment products.
In the ARK Fintech Innovation ETF (ARKF), Circle represents around 4.37% of the portfolio, making it the fund’s seventh-largest holding with a value of approximately $33 million.
The company also accounts for about 3.35% of the ARK Innovation ETF (ARKK), where it ranks as the ninth-largest holding with a position worth roughly $218 million.
The growing allocation reflects ARK’s view that stablecoins and blockchain-based financial infrastructure could play a major role in the future of digital finance.
Analysts Question Circle’s Short-Term Outlook
While ARK continues buying, some analysts have become increasingly cautious about Circle’s near-term prospects following the stock’s steep decline.
Digital asset research firm 10x Research recently changed its view on Circle, saying it no longer considers the stock a buy after its price dropped below $80.
The firm previously viewed Circle as attractive at that level but argued that the company’s fundamentals have weakened significantly.
USDC Growth Concerns Put Pressure on Investor Confidence
One of the major concerns raised by analysts involves slowing activity around Circle’s USDC stablecoin.
10x Research pointed to declining active addresses and reduced network activity as signs that demand growth may be facing challenges.
USDC’s market capitalization has fallen around 3% since the start of the year, standing near $73 billion, according to CoinGecko data.
However, despite the recent decline, the stablecoin remains significantly larger than it was a year ago, with market capitalization still about 17% higher compared with the previous period.
Circle’s Future Remains a Debate Among Investors
The current disagreement surrounding Circle reflects a wider debate about the future of stablecoins and digital asset infrastructure.
While some analysts believe recent weakness could signal deeper problems for the company, others see the decline as a potential opportunity for long-term investors.
10x Research noted that Circle’s falling share price could represent either an attractive entry point for investors who believe in the company’s future or the beginning of a longer period of challenges.
ARK Sticks With Long-Term Crypto Vision
Despite growing criticism from some market observers, ARK Invest’s continued purchases suggest the firm remains confident in Circle’s ability to benefit from the expanding role of stablecoins in global finance.
For Cathie Wood and her investment team, the recent sell-off appears to be viewed as a temporary setback rather than a reason to abandon their long-term bet on the USDC issuer.
