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ARK Warns of More Crypto Bankruptcies

ARK is still buying more Tesla, SpaceX, and a Solana staking ETF, but at the same time it sees more crypto bankruptcies and takeovers as capital flows toward profitable players.

By Mike Hesp
• 2 min read
ARK Warns of More Crypto Bankruptcies

Key Takeaways

  • ARK bought more shares this week in Tesla, SpaceX, NVIDIA, and BitMine, while the fund also sold part of its Robinhood stake.
  • ARK expects more crypto bankruptcies, Chapter 11 filings, shutdowns, and acqui-hires as capital gets more selective and weaker teams fall behind.
  • According to ARK, a small group of crypto apps dominates revenue, which makes it even harder for smaller projects to survive.

Cathie Wood’s ARK added to several of its biggest positions again this week, even as the firm said the crypto sector may be heading for a fresh wave of bankruptcies and shutdowns. The two moves may look at odds, but ARK says they reflect the same broader trend: capital is concentrating in companies and projects that are already generating revenue, while weaker crypto teams are finding it harder to stay afloat.

ARK Buys More Again

In the July 27 filing, ARK disclosed four new purchases. The firm added 28,705 Tesla shares, 38,727 SpaceX shares, 8,332 NVIDIA shares, and 97,383 shares of BitMine, which is focused on an Ethereum treasury. BitMine saw the largest percentage increase of the group.

The next day, ARK went back in on Tesla and SpaceX. It bought another 23,943 Tesla shares, lifting that position to about $860.6 million (€757 million), and added 118,709 more SpaceX shares, bringing the stake to roughly $498.6 million (€439 million). Based on the available data, ARK has been building its SpaceX position for some time, even as the valuation has come under pressure near the IPO price.

Fund inflows may also be part of the story. Most of the July 27 purchases were sized at around 1%, which often suggests fresh money entering the funds rather than isolated stock calls. Robinhood was the exception, with ARK trimming 32,021 shares.

Why ARK Is Downbeat on Crypto

Lorenzo Valente, who leads digital assets research at ARK, says crypto is going through its most aggressive cleanup yet. In his view, capital is becoming more selective, and projects without real users are getting pushed out faster. That is why he expects more M&A, Chapter 11 filings, shutdowns, and acqui-hires in the months ahead.

Valente also points to how concentrated crypto app revenue has become. Hyperliquid and Pump.fun account for 67% of all revenue generated by crypto apps, and when Ethena is added, the top three make up nearly 80%. In other words, only a small group of apps is capturing most of the money, leaving far less room for smaller projects to survive on their own.

What This Means for European Readers

For European crypto investors, the message is that ARK is drawing a clear line between profitable businesses and fragile crypto projects. In a market where capital is becoming more selective, that could ripple beyond the U.S. and affect DeFi teams, token projects, and funds that rely on steady growth. On July 27, ARK did buy 26,203 units of the 3iQ Solana Staking ETF, worth about $158,000 (€139,000), but that is still tiny compared with the millions it put into Tesla and SpaceX.

The pressure on DeFi is not only financial, but regulatory as well. For instance, the SEC recently warned that some DeFi vaults may fall under securities law, which could make it even harder for new projects to get off the ground.

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