Yahoo Finance’s Alexandra Semenova discusses ARK Invest Founder Cathie Wood doubling down on bitcoin despite worries of an FTX contagion effect in crypto.
AKIKO FUJITA: Well, let's now turn to another headline in the world of crypto. We've got investor Cathie Wood making big buys in this space. Let's bring in Yahoo Finance's Alexandra Semenova. And Alexandra, it's not just about her buying, I guess you could call it the dip, but also making a pretty bold call here in the face of the collapse we've seen in the crypto space.
ALEXANDRA SEMENOVA: Yeah, exactly, Akiko. Even as the fall of FTX rocks crypto world, Cathie Wood appears to be unfazed when it comes to her conviction in crypto. The Ark Invest founder and CEO said yesterday, in an interview with Bloomberg, that she is sticking by her Bitcoin price target of $1 million per token by 2030.
This comes as many in the crypto space raised concerns about the full contagion effect of the FTX collapse, effects that could take weeks, months, maybe even years to play out. Many have also sounded the alarm on faltering trust in crypto as well, Bitcoin now trading around the 16,000 range, far below Ark's big $1 million bet.
What is also putting her money where her mouth is, snapping up Grayscale's heavily discounted Bitcoin fund and shares of crypto exchange Coinbase across Ark's funds. She is a big Coinbase bull, too. Ark is the fourth largest shareholder of the company. And even as Coinbase asserts that it is an SEC regulated company that does not have direct exposure to FTX, it has been feeling the ripple effects and taking a huge hit.
Wood's assertions about crypto also come as her ARK Invest fund is down more than 60% year to date. Now, Akiko, Ark does consistently point to the five year, or the 10-year time horizon. But worth noting that investors in her fund are sitting on massive losses right now because of these lofty bets.
One of the big reasons that Ark has largely maintained its investor base and even attracted new inflows despite its drawdown is that what it has, massive conviction in what she does, it has been a strong selling point for Ark. So when Wood says that Bitcoin will hit $1 million less than a decade from now, that does carry a lot of weight for the retail investors, the investors who are listening to her and perhaps interested in making this incredibly volatile bet.
AKIKO FUJITA: Well, Alexandra, to your point, I mean, worth taking this with a skeptical eye, given her fund performance. What do we know about her past calls on Bitcoin? And how much of those calls have actually materialized?
ALEXANDRA SEMENOVA: Well, she-- Coinbase is a good example. She purchased shares of Coinbase when it was trading around $200. And now it is down. She's sitting on those losses, and still buying even more of that stock. She's made a very lofty calls on Tesla, on Roku, stocks that are down more than 70% year to date. So really worth approaching this call on Bitcoin with skepticism. As I said, trading around the 16,000 range, and she is betting that within 10 years, it'll be at $1 million.
AKIKO FUJITA: OK. We'll call it right there. Alexandra Semenova, thanks so much for that.