Cathie Wood is making moves! From AMD stock gains to Coinbase adjustments, plus a dive into the potential of crypto-backed mortgages. Buckle up!
Cathie Wood is never one to shy away from disruptive innovation, and her recent moves at Ark Invest are certainly turning heads. Let's dive into her latest plays involving AMD, Coinbase, and the intriguing possibility of crypto-backed mortgages.
AMD: An AI Infrastructure Power Play
On Monday, Ark Invest significantly increased its holdings in Advanced Micro Devices (AMD). Wood's funds scooped up 356,275 AMD shares, valued at a cool $50.55 million. This shows confidence in AMD's role in the burgeoning AI infrastructure landscape. With AMD collaborating with HCLTech to advance AI and cloud computing solutions, it seems Wood is betting big on the chipmaker's future.
Coinbase: Strategic Trimming Amidst Crypto Optimism
While bullish on AMD, Ark Invest trimmed its Coinbase (COIN) position, selling 124,892 shares worth $43.77 million. This move comes despite Bernstein's recent bullish price target for Coinbase. Wood's reasoning might stem from the mortgage hurdles faced by Bitcoin investors, potentially driving capital toward regulated exchanges like Coinbase. However, Coinbase remains a top holding in Ark's portfolio, signaling a continued, albeit moderated, belief in the crypto exchange.
Crypto Mortgages: A Brave New World?
The U.S. Federal Housing Finance Agency (FHFA) is exploring a proposal to factor in cryptocurrency holdings, particularly Bitcoin, when qualifying for a mortgage. Cathie Wood has lauded this move as “a major step” toward integrating digital assets with traditional financial systems.
Why This Matters
This proposal could open homeownership to millions of crypto investors who are currently locked out due to their wealth being stored in digital assets. Instead of forcing crypto holders to convert their holdings to cash (and incur taxable events), the FHFA's proposal would allow them to use their Bitcoin to secure home loans. It redefines who is “creditworthy,” embracing modern wealth building and incentivizing lenders to create crypto-specific mortgage products.
Beyond Mortgages
If adopted, this proposal could have far-reaching effects, legitimizing digital assets within the broader financial system. Banks might even develop infrastructures for crypto-backed loans, potentially leading to new types of mortgage-backed securities with exposure to digital assets.
Final Thoughts
Cathie Wood's moves are always worth watching, and her recent plays involving AMD, Coinbase, and crypto mortgages highlight the evolving intersection of tech, finance, and digital assets. Whether you're a seasoned investor or just dipping your toes in the water, these developments could reshape the future of how we build wealth and access financial opportunities. The FHFA's decision is still pending, but it's a sign that the financial world is slowly but surely recognizing the power of digital assets. Who knows, maybe one day you'll be buying your dream brownstone with Bitcoin!
