Coinbase founder and CEO Brian Armstrong sold BRL 8.5 million worth of shares in his exchange. Documents indicate that the sale process began a day before his brokerage was indicted by the SEC, raising suspicion.
The document, called Form 144, was filed on Monday (5) noting that Armstrong would be planning to sell shares of Coinbase. The sale of 29,730 shares totaled US$1,745,299.65 (R$8.5 million).
Coinbase shares had already fallen that day as the SEC filed 13 lawsuits against its rival Binance. As early as Tuesday (6), the SEC also sued Coinbase, further melting its share price.
Coinbase shares continue to be under pressure from its own executives
Coinbase shares, traded on Nasdaq, have fallen sharply since their IPO, held in April 2021. In the period, reels have already fallen by 87.5%, underperforming the largest cryptocurrencies in the market such as Bitcoin and Ethereum.
Part of this selling pressure is caused by Coinbase’s own founders and executives. After all, this isn’t the first controversial sale.
In November 2022, Brian Armstrong had already made headlines by making the same move. On that date, even Nassim Taleb commented on the matter and stated that “a CEO never sells his own shares” and that this lowered the confidence of other investors.
The founder of Ethereum tried to defend Armstrong at the time, but was also offended by Taleb. Vitalik Buterin is also someone who often plays against his own project and sells different lots of ETH on the market.
Community was surprised at the time of its CEO’s sale of Coinbase shares
The recent sale by Brian Armstrong sparked controversy over its inconvenient timing. Through social media, the Bitfinexed profile, a famous broker critic, commented on the move with sour words similar to Taleb’s.
“Nothing inspires confidence in your company more than putting millions of dollars in stock while your company is being sued for selling unregistered securities”responded to the profile, accusing Coinbase of other crimes.
Coinbase executives continue to dump millions of dollars out of Coinbase stock.
Nothing inspires confidence in your company more than dumping millions of dollars in stock while your company is being sued for selling unregistered securities.
Maybe employee traded shitcoins and… pic.twitter.com/999CcpHJvb
— Bitfinex’ed 🔥🐧 Κασσάνδρα 🏺 (@Bitfinexed) June 8, 2023
In the comments, other users even accuse Armstrong of insider trading, that is, operating in the market using privileged information. Recently, Coinbase’s former product manager pleaded guilty to such a crime.
However, due to Armstrong’s extensive sales history, this hypothesis is hard to believe. In other words, everything points to this not being a crime, just another ‘shot in the foot’. Between Monday and Tuesday, Coinbase shares fell 26.7%, but some of the losses were already recouped in the following days.
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
