Cathie Wood's ARK Invest added to its two largest stablecoin-linked holdings on Monday, buying Coinbase Global (COIN) after the exchange's post-earnings slide and lifting its stake in Circle (CRCL) two days before the USDC issuer reports third-quarter results.
The purchases spanned three of the firm's exchange-traded funds: the ARK Innovation ETF (ARKK), the ARK Next Generation Internet ETF (ARKW) and the ARK Fintech Innovation ETF (ARKF). ARK picked up 24,790 Coinbase shares, worth roughly $3.4 million at Monday's close, and 35,657 Circle shares valued at about $2.6 million, according to Stocktwits.
The same session brought a smaller addition in Robinhood Markets (HOOD), with 7,703 shares going into ARKF, and a reduction in crypto exchange Bullish (BLSH), where 104,172 shares were sold for about $2.3 million.
The Coinbase purchase extends a buying run that began Friday, when ARK acquired 39,418 shares, bringing the two-session total to 64,208. Circle purchases across the same two sessions reached 110,551 shares, while Bullish sales totaled 342,545, according to trade notices the firm publishes. ARK describes those notices as unofficial and unreconciled, noting they exclude ETF creation and redemption activity and offering transactions and carry no execution prices.
Two Ends of One Payment Pool
The timing places the buying between earnings reports. Coinbase has already filed its third-quarter 10-Q, while Circle reports Wednesday with a webcast scheduled for 8 a.m. ET. Bullish does not report until Nov. 18.
Coinbase's filing showed revenue of about $1.2 billion, in line with Wall Street forecasts but flat sequentially and down 28% from a year earlier. Earnings per share matched expectations for a $0.09 loss. The stock has fallen about 14% since the report, as investors questioned the quality of profitability, which leaned on unrealized crypto gains rather than trading or recurring revenue.
Within that filing, the stablecoin line carried more weight than a year ago. Stablecoin revenue slipped about 5% to $306.9 million, while transaction revenue dropped 44% to $590.2 million. Trading shrank so much faster that stablecoins climbed from roughly 18% of net revenue in the third quarter of 2025 to more than a quarter now.
Circle sits at the far end of that dependence. Its second-quarter results showed $701 million in total revenue and reserve income, up 7% from a year earlier, with reserves generating nearly all of it. Distribution, transaction and other costs took $412 million, close to 59 cents of every revenue dollar, largely in payments to distribution partners. A substantial share of those payments flows to Coinbase, which receives about half of USDC revenue under its agreement with Circle, while roughly 30% of USDC in circulation sits on Coinbase's platform.
For a holder of both stocks, that arrangement means sharing a single income pool rather than doubling a bet on it. Money leaving Circle as a distribution cost reappears as Coinbase stablecoin revenue, so a shift in how the two split the proceeds matters less than a change in the size of the pool itself.
The pool rests on two variables: how much USDC is outstanding and what its reserves earn. In Circle's second quarter they pulled in opposite directions. Average USDC in circulation grew 25% year over year, yet reserve income rose only 5% because the reserve return rate fell 66 basis points. That is the central risk in the paired trade: larger balances do not produce larger income when short-term rates decline, and both stocks carry the same rate exposure.
What Wednesday's Report Can Confirm
Analysts expect Circle to report revenue of about $789 million and earnings of $0.42 a share, according to Koyfin data cited in the report. Because Circle's third quarter covers the same July-to-September period as Coinbase's 10-Q, the two sides of the USDC split can be read against each other.
Three lines in the report carry the most weight. Reserve income against a year earlier will show whether Coinbase took a smaller slice; if it grew while Coinbase's stablecoin revenue shrank, the split moved in Circle's favor. Average USDC against the reserve return rate will reveal whether balance growth outpaced the yield decline that held second-quarter reserve income to single-digit growth. Distribution costs as a share of revenue will indicate whether partners are capturing more or less of each reserve dollar.
ARKK's Nov. 2 holdings file shows Circle at 4.5% of the fund and Coinbase at 3.8%, together more than five times Bullish's 1.5% weight. Because weights move with share prices, the file shows where positions stand rather than how much two days of buying added.
Bullish's Changing Shape
The Bullish that ARK is selling earns its money differently. The company reported $92.6 million in adjusted revenue in its second quarter, a non-IFRS measure, of which $29.9 million came from transactions and the remainder from subscriptions, services and other lines including CoinDesk data, indices, media and liquidity services.
That mix could shift if a pending acquisition closes. In May, Bullish agreed to buy transfer agent Equiniti in a $4.2 billion deal comprising $1.85 billion in assumed debt and about $2.35 billion in Bullish stock. Management put the stock portion at roughly 61 million new shares on the investor call filed with the SEC. Bullish's Oct. 28 filing calculated its fully diluted share count near 156 million, so the deal would add shares equal to about 39% of that base. Closing is expected in January 2027, subject to regulatory approvals.
ARK has bought Bullish before, including purchases in September 2025. The latest sales reduce a position in a company whose revenue base, share count and core business could look substantially different a year from now.
The trades also land ahead of Election Day. Congress has been working on rules for crypto markets, including the CLARITY Act, which would set out how digital assets are regulated, and the midterm results will decide which party controls Congress.
For investors tracking the stablecoin theme, the immediate test is whether Circle's reserve income holds up as rates decline. If it does, ARK's tilt toward USDC-linked names has firmer support. If yields erase balance growth again, both new positions face the same pressure at once.
