Cathie Wood's Ark Invest has reduced its holdings in Coinbase, selling off $15.1 million worth of shares across three exchange-traded funds (ETFs). This move came despite Coinbase's impressive first-quarter earnings report, which showed higher revenue than expected and a record high in institutional trading volume.

On May 7th, Ark Invest sold 70,616 Coinbase shares, divided among its Innovation ETF (ARKK), Next Generation Internet ETF (ARKW), and Fintech Innovation ETF (ARKF). This sale follows a similar move less than a month ago, where Ark Invest sold $20.4 million worth of Coinbase shares. The investment firm aims to limit its exposure to any single stock to no more than 10% of its ETF portfolio, ensuring a well-diversified portfolio.

Coinbase reported a strong performance, with total revenue of $1.64 billion, surpassing estimates. Despite this, Ark Invest chose to offload shares, suggesting a strategic move influenced by various factors beyond Coinbase's recent financial success. Coinbase remains a significant holding in Ark Invest's ETFs, ranking third in ARKK, fourth in ARKW, and leading in ARKF.

Ark Invest's move may be a rebalancing strategy to maintain its investment approach, rather than a reflection on Coinbase's performance. The sale highlights the firm's commitment to diversification and risk management in its ETF portfolios.