On 14th April, Coinbase went live on NASDAQ. It is the first major crypto-related company to go public. The company set its reference price for $250, but the shares started trading much above that. Recently, news surfaced that investors dumped billions of dollars worth of company shares in the open market after the same. Yes, even though many early holders sold their shares, the company still has strong ownership, so it’s not necessarily a bad thing. In fact, Meltem Demirors came forward on Twitter to clear the air regarding the rumors floating around the same.
this is making the rounds and is so misleading – details matter!
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 https://t.co/LP4uKK1Nuq
— Meltem Demirors (@Melt_Dem) April 17, 2021
What actually happened with Coinbase shares?
After the COIN listing was done, several investors and executives sold huge amounts of their holdings in the market. And this created panic as people were thinking that Coinbase is getting liquidated as everyone is selling their shares. But that is not the case; it has been confirmed that the sellers still have strong ownership of the company. And they have only sold a part of their holdings. Data suggests that about $4.6 billion worth of shares were sold at an average price of $344.38 per share after the listing. This is even less than 10% of the entire company size.
Some of the major sales that happened after the listing was from CFO Alesia and CEO Brian. The former sold around 255,500 shares, and the CEO sold 749,999 shares. According to previous filing reports, Brian held over 36,851,833 shares of the company. This means he sold just 2% of his holdings. This clearly suggests that the company officials have a belief in its future, and they are liquidating only a small portion of their shares. So, I am pretty sure those who are holding on to their shares there is no reason to panic.
While many reporters have been sharing numbers on their sales, the official coinbase representatives have confirmed that they were not accurate. As per the tweet, no employee or executive of the company sold more than 10% of their holdings. This misinformation is making people think that pump and dump is going on and Coinbase is manipulating the market. But that is not the case, and still, more than 90% of the company is not liquidated.
At the same time, we should also consider that huge amounts of shares are also bought by hedge funds and other big investors. ARK invest has bought $350 million worth of shares for the funds ETFs. And now even company employees hold 100 shares each as gifted by the company on the occasion of the IPO. I think that the company is doing a pretty good job and there is nothing as such to worry about.
What are your thoughts on the misinformation spread by media regarding the sales of Coinbase’s shares? And are you holding any shares? Let us know in the comments below. Also, if you found our content informative, do like it and share it with your friends.