Coinbase’s CEO sold 749,999 shares on the day of the exchange’s long-awaited stock market debut, it has emerged.
Brian Armstrong pocketed proceeds of $291.8 million as a result — offloading COIN at prices as high as $410.40.
It is worth noting that none of this is as nefarious as it may seem. Coinbase’s decision to pursue a direct listing means that executives aren’t subject to the lock-up periods that are seen in the aftermath of an initial public offering.
Direct listings involve existing shares becoming public, rather than new ones being created.
Nonetheless, it prompted some critics to claim that Coinbase executives had engaged in a “pump and dump.”
Other crypto analysts, such as Meltem Demirors, sought to expose the bigger picture surrounding the sale of COIN stock, which also extended to a flurry of other executives and early investors. Reports suggest that shares worth $5 billion were sold — a drop in the bucket considering the exchange’s market cap is $64.3 billion as of Friday’s close.
Responding to a tweet that has since been deleted, Demirors wrote:
“each of these execs have tons of unvested options that account for the majority of their holdings - in reality they’ve each sold less than 10% of their total shares.”
Indeed, in Armstrong’s case, he’s only actually sold 1.5% of the shares he controls.
Coinbase closed Friday’s session at $342 — a 36.8% improvement on the reference price of $250 that had been set on Wednesday. It’ll be interesting to see how the stock reacts to the sudden flash crash that Bitcoin experienced over the weekend.