Shares of Coinbase (NASDAQ:COIN) stock are in full focus following the submission of a Form 4 from Director, co-founder and 10% owner Fred Ehrsam III. The filing revealed that Ehrsam sold off 81,530 shares worth $8.71 million on Nov. 22 from his living trust. These shares were sold at average prices ranging between $103.98 and $109.62. Additionally, the sale was enacted via a prearranged 10b5-1 trading plan established on Aug. 21.
Following the sale, Ehrsam still owns a significant stake in the cryptocurrency company. He owns 1.05 million shares through his living trust, 4,662 shares directly, 2.58 million shares through the Paradigm Fund and another 1.93 million shares through Paradigm One. Ehrsam’s living trust as well as Paradigm co-founder Matt Huang are managing members of the Paradigm Fund and Paradigm One, according to the filing. All together, Ehrsam’s remaining stake, both direct and indirect, adds up to 5.57 million shares.
COIN Stock: Coinbase Co-founder Fred Ehrsam III Sells 81,530 Shares
In late October, it was announced that Ehrsam would step down as the Managing Partner of Paradigm and move to a General Partner role. Ehrsam informed employees of the fund that he planned on focusing on futuristic health technologies.
“This change allows me to carve out some time to explore areas of science that are of personal passion for me,” said Ehrsam. It’s entirely possible that Ehrsam is selling off a relatively small portion of his stake to fund his new ventures.
Ehrsam’s sale does not convey a loss of faith in COIN stock due to its relatively small size. However, aggregate insider selling of COIN has run rampant since the company became publicly traded. Since then, insiders have purchased $136.93 million of shares while selling a whopping $5.89 billion of shares. That nets out to $5.75 billion of shares sold.
CEO Brian Armstrong has been responsible for $348.12 million of sales and has not purchased a single share during this period. Armstrong’s last few sales reflect a pattern of converting Class B stock into Class A stock and then immediately selling through a prearranged 10b5-1 trading plan.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
