MicroStrategy’s Chief Financial Officer, Phong Le, and Chief Technology Officer, Timothy Lang, sold shares in the company in August, exercising about 30% of the options they received as compensation.
This was revealed in a recent document filed by the company with the SEC, which states that Phong Le and Timothy Lang, as well as other executives of the company, have been receiving bonuses and compensation in shares or options for years.
As the price of Bitcoin climbed in August, they each made gains of about $7 million in sales. CEO Michael Saylor, on the other hand, is not reported to have sold anything.
Phong exercised 20,000 stock options, from August 2 to 6, cashing in at just over $7.30 million, while Lang exercised 10,000 stock options from August 26, cashing in at $7.10 million. Both still retain about 20,000 stock options each.
Is Microstrategy’s fortune tied to Bitcoin?
According to Bloomberg, the two would not be particularly confident about tying their long-term fortunes to those of the company, especially since they are now closely tied to those of Bitcoin.
Bloomberg adds that the sale of stock options by executives is not uncommon, not least because they are considered part of their compensation, and selling them serves to monetize part of their compensation.
It should also be noted that the company’s share price has risen almost fivefold in the last 12 months, so monetizing now makes perfect sense, especially when only part of it (like 30%) is sold.
According to some financial analysts such as Miller Tabak’s Chief Market Strategist Matt Maley, these sales could indicate that company officials are worried about the company’s future.
“Senior executives do not sell stock if they think it’s going higher. It’s just a bad sign no matter how you slice it”.
No stock options were granted to MicroStrategy executives last year, but they had been granted in previous years.
Oanda’s senior market analyst Ed Moya doesn’t see MicroStrategy‘s insiders selling as something that will disrupt the bullish cryptocurrency market in the long term.
Microstrategy, stock and strategies
In the first ten days of August, Microstrategy’s share price rose from $627 to $781, only to fall back to around $650 on August 19. After rebounding to $728 on 23 August, the stock moved sideways near $700 until 3 September.
When markets reopened, it fell to around $630, at the same time as the bitcoin price collapsed on Tuesday, and then rose again to around $637.
During the same period, the price of bitcoin rose from nearly $40,000 on 30 July to $47,000 on 16 August, before retreating slightly and recovering to above $50,000 on 23 August. After a brief period of lateralisation around $48,000, it had risen to almost $53,000 on 7 September, before suddenly falling back to around $46,000 today.