Cathie Wood d'Ark Invest Spillwette grouss op Cash App, Dumps PayPal

American asset management company Ark Invest has sold its holdings of fintech giant PayPal and backed Bitcoin-friendly Cash App.

This comes after Cathie Wood, CEO of Ark Invest, revealed her preference for Block’s (formerly Square) Cash App over PayPal’s Venmo at the 2022 North American Bitcoin Conference in Miami.

Backing Cash App

Wood believes Cash App has embraced an organic growth structure in contrast to Venmo’s “top-down” and frantic approach to Bitcoin and highlighted Block’s wider focus on the digital asset via the layer 2 Lighting network.

While speaking to CNBC correspondent Kate Rooney about choosing Block over PayPay, the Bitcoin bull ausgedréckt confidence over Cash App’s long-term growth and stated,

“We tend to put our bets on who we believe will be the winners. As we consolidated our portfolios during a risk-off period, we chose Block over PayPal.”

Betting on Bitcoin and Innovation

Many funds of Cathie Wood’s Ark Invest have clobbered amidst the tech stock crash as investors mostly rotated away from high-growth stocks.

The company rushed out to shred most of its exposure in Paypal Holdings at the beginning of February after the fintech giant ditched an ambitious growth strategy it put in place last year. In addition to that, Ark Invest also sold shares of several household names and, in turn, poured money into more innovative niches.

Commenting on Block’s performance throughout last year, the asset management company noted earlier,

“Block’s solid performance assuaged analysts’ concerns that, in the absence of Covid-19 government stimulus, the momentum in Cash App, Block’s consumer-focused digital wallet, would slow down considerably.

Block’s management also noted continued strong momentum in January and February, citing 21% growth in Cash App’s gross profit on a year-over-year and 73% [on a] two-year-annualized basic.”

For context, Cash App witnessed a rapidly accelerated revenue generation after introducing Bitcoin trading on its app, which subsequently rechent for 76% of its revenue in 2020. The very next year, Cash App managed to net a profit of $2.03 billion.

It generated $12.3 billion in revenue, 81% of that came from Bitcoin. Naturally, its trajectory is mostly tied to the primary cryptocurrency. Hence, the long-term prospects appear bullish to Wood, who opined that the asset is poised to reach $1 million in the next few years.