Coinbase CEO Brian Armstrong is on the brink of fulfilling his commitment to selling 2% of his company stake to fund innovative ventures in the realms of life extension and science crowdfunding. 

The charismatic entrepreneur has been making headlines with his strategic divestment of nearly 27,600 COIN shares last week, pocketing an impressive $2.9 million. Since his initial announcement, Armstrong has successfully sold a remarkable 681,672 shares, resulting in an impressive $42.4 million windfall for the crypto billionaire.

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As of the company’s 2022 proxy statement, Armstrong’s Coinbase stake consisted of 39.6 million shares. The 2% target represents approximately 792,000 shares, amounting to 18% of the company with 59.5% voting power. With his recent transactions, Armstrong has now offloaded a staggering 86% of this targeted goal. Averaging out the numbers, the esteemed CEO has achieved an impressive $62.15 per share through these divestments. Armstrong has expressed his intention to direct these funds to support ventures such as NewLimit and ResearchHub, both of which he co-founded. 

NewLimit stands as a life extension venture, while ResearchHub serves as a pioneering crypto-powered crowdfunding platform for scientific research. Armstrong’s significant net worth is currently estimated at an impressive $4.3 billion.

It is worth noting that Coinbase stock had previously traded at $64 when Armstrong initially pledged to sell his stake back in October. However, the stock’s value experienced a sharp decline, plummeting by 50% to a low of $31.55 by January. Fortunately, the tide turned, and the stock’s value rebounded, currently sitting at $105. Blockworks has reached out to Armstrong for his thoughts on these developments.

Although Armstrong’s recent divestments have been substantial, other company insiders have been active in the market. In fact, collectively, they have sold over $5 billion in company stock during COIN’s first two days of trade. Among them, early investor and board director Fred Wilson, along with Union Square Ventures, accounted for nearly three-quarters of the total sold.

Interestingly, while Armstrong’s stock sales have been prominent, the CEO’s direct listing in April 2021 remains a remarkable feat. On that occasion, he cashed in 750,000 shares for an astounding $291.8 million, translating to $389.10 per share. Since then, however, Coinbase stock has faced significant challenges, losing nearly three-quarters of its value.

To maintain transparency and comply with regulations, Armstrong executed his stock sales via The Brian Armstrong Living Trust, following a Rule 10b5-1 trading plan. Despite the market turbulence, two Coinbase insiders have displayed confidence in the company’s potential and bought shares. Co-founder Fred Ehrsam’s fund, Paradigm, invested $128.9 million in 1.93 million shares at an average price of $65.67 between May 2022 and May 2023. Similarly, Shopify CEO Tobias Lütke, also a Coinbase board member, purchased more than 183,300 shares for $10 million, averaging at $54.93 between August 2022 and February 2023. Both insiders have seen substantial gains on their investments, with Ehrsam up almost 60% and Lütke nearly 90%.

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Ehrsam’s earlier divestments, executed between the direct listing and December 2021, reaped substantial rewards. His trust sold 1.5 million COIN shares at an average price of $382.20, yielding over $492 million—nearly four times the value of his fund’s purchases during the market dip.

As the crypto world continues to evolve, Armstrong’s funding of pioneering ventures will likely further diversify and strengthen the ecosystem, showcasing the innovation and potential of the digital currency landscape.

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Written by Agbo Obinnaya

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