Coinbase leaders make $1.2 billion in stock sales


The four best Coinbase COIN 7.80%

Global Inc. officials have collectively pocketed more than $1 billion selling shares since the cryptocurrency exchange went public last spring, a period in which the company’s shares have fallen by about 80%.

Co-founders Brian Armstrong and Fred Ehrsam, along with president and chief operating officer Emilie Choi and chief product officer Surojit Chatterjee, together brought in approximately $1.2 billion in proceeds from the stock sale as of the day. where the San Francisco-based company began operations until February. this year, according to a Wall Street Journal analysis of regulatory filings.

They sold the shares at prices ranging from $189 to $422. Coinbase opened at $381 on April 14, 2021, its first day of trading. On Friday, the stock closed at $75.32.

WSJ’s Dion Rabouin explains why Wall Street is now betting big on crypto and what that means for the new asset class and its future. Photo composition: Elizabeth Smelov

Cryptocurrencies have fallen dramatically this year as investors dump risky assets amid concerns about rising interest rates and soaring inflation. Coinbase investors suffered even more. Bitcoin is down 25% in May to Friday’s level at 5 p.m. ET, while Coinbase is down around 33% this month.

Some analysts have said investors expect executives, especially founders, to sell shares during or after an initial public offering after locking up their stakes for so long.

“These Coinbase executives hold important positions in the company, which reflects their commitment to our long-term opportunities,” a Coinbase spokesperson said.

Mr. Armstrong and his living trust sold shares for total proceeds of $292 million, according to Journal analysis of regulatory filings. He still owns a majority stake in the company, with 59.5% of the voting rights, according to an April regulatory filing.

Ms. Choi exercised options at a cost of $9.7 million and sold shares for total proceeds of $226 million, while Mr. Chatterjee exercised options at a cost of $6 million and sold shares for total proceeds of $110 million.

Surojit Chatterjee, chief product officer of Coinbase, exercised options for a cost of $6 million and sold shares for total proceeds of $110 million.


Photo:

Samyukta Lakshmi/Bloomberg News

Mr. Ehrsam pocketed nearly half a billion dollars from stock sales during the period. Earlier this month, as the stock plummeted, Mr Ehrsam bought $75 million worth of shares on behalf of the cryptocurrency investment firm he co-founded, Paradigm One. LP A regulatory filing on Thursday showed it had purchased an additional $1.8 million worth of stock. earlier this week on behalf of Paradigm One.

Much of the stock selling took place on the first day of trading, as all four sold shares in Coinbase’s direct listing. In a direct listing, early investors typically sell portions of their total holdings to allow outsiders to buy shares of the company on the day the markets open. These sales are critical to the smooth running of direct listings, as the company typically does not sell any shares, unlike an initial public offering.

Write to Corrie Driebusch at [email protected] and Tom McGinty at [email protected]

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Appeared in the May 28, 2022 print edition as “Coinbase Executives Pocket $1.2 Billion”.


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