Coinbase made its highly anticipated debut on the Nasdaq on April 14, but its stock ($COIN) has since faced a continuous decline. The company's valuation fell short of the projected $100 billion, and Bitcoin's subsequent crash further fueled speculation that Coinbase's IPO might be a classic "buy the rumor, sell the news" event. Public attention has now shifted to the significant sell-off by the company's executives and early investors.
Board Members and Investors Dump $COIN Shares
Data from Open Insider reveals that top executives and investors sold shares shortly after Coinbase went public. Key sellers include:
- CFO Alesia Haas
- COO Emilie Choi
- Chief Accounting Officer Jennifer Jones
- CEO Brian Armstrong
- Chief Product Officer Surojit Chatterjee
- Co-founder Fred Ehrsam
- Board member Kathryn Haun
- Early investor Frederick Wilson
- Board member Marc Andreessen (a16z)
- Union Square Ventures
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CEO Sells 71% of His Holdings
Brian Armstrong, Coinbase’s CEO, sold 71% of his existing shares at an average price of $389.1, while CFO Alesia Haas liquidated her entire stake at $388.73 per share, netting nearly $100 million.
It’s worth noting that SEC filings clarified these sales were tied to option vesting schedules, with full equity distribution expected by June 2023. Despite the sell-off, the $5 billion in shares sold represents only a fraction of Coinbase’s $67.3 billion market cap at the time of writing.
CZ’s Stance: "BNB Isn’t Going Anywhere"
Binance CEO Changpeng Zhao (CZ) weighed in on the situation via Twitter, stating:
"I’m not against people cashing out. It’s their right and choice. Brian worked hard for 9 years, built a path for others to follow, and set a milestone for the industry. Kudos!"
However, CZ emphasized Binance’s contrasting approach:
- The Binance team retains 40% of BNB’s total supply, worth over $37 billion (as of April 18).
- He affirmed: "We haven’t sold—and won’t sell—a single BNB. Eventually, all will be burned."
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DPO vs. IPO: Key Differences
A Direct Public Offering (DPO) differs from an IPO in several ways:
| Feature | DPO | IPO |
|------------------|------------------------------|------------------------------|
| Capital Raised | None (existing shares only) | New shares issued |
| Lock-up Periods | Typically none | 90–180 days for insiders |
| Examples | Spotify, Palantir, Coinbase | Airbnb, Snowflake |
DPOs allow early stakeholders to trade shares immediately, explaining why Coinbase’s insiders dominated initial sales.
FAQ Section
Q: Why did Coinbase executives sell their shares?
A: Sales were tied to vesting schedules and liquidity needs—common after a DPO.
Q: Does CZ’s statement imply Binance is more committed to BNB?
A: While CZ advocates holding BNB, Coinbase’s sales reflect standard post-listing dynamics.
Q: How does a DPO impact retail investors?
A: DPOs often reduce lock-up pressures but may increase early volatility.
Risk Disclosure: Cryptocurrency investments carry high risk due to price volatility. Assess your risk tolerance before investing.
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