MicroStrategy, a Virginia-based enterprise software firm, has caught the attention of crypto news outlets and financial journalists alike. Its CEO, who is all in on Bitcoin starting in 2020, has been atypical. Some reporters speculate that the company has become more of an investment vehicle for Bitcoin (BTC).
Recent filings to the United States Securities and Exchange Commission indicate that some company executives are uncertain about the long-term viability of this strategy.
According to the filings, MicroStrategy’s chief financial officer Phong Lee and chief technology officer Timothy Lang each unloaded stock in August this year after exercising around 30% of their options as compensation.
Bloomberg reports that Lang exercised 10,000 options on Aug. 26, and then sold all converted shares for $7.1 million. Phong on the other hand, exercised 20,000 options from Aug. 2 to 6, then sold the shares for just over $7.3million. Each of the options has remained close to 20,000.
Although CEO Michael Saylor has not sold shares since 2012, he did transfer 50,000 shares of Class-A company stock to Alcantara LLC in January.
Phong and Lang made their moves without any pre-arranged trading plans. This is despite executives exercising their options being common. Matt Maley, Miller Tabak + Co.’s chief market strategist, suggested that this decision could be indicative of their concern about Saylor’s corporate strategy, and his commitment to tie the company’s fate to Bitcoin. Senior executives don’t sell stock if they believe it will go higher. Maley stated that it is a sign of trouble, regardless of how you interpret it.
MicroStrategy had an estimated 105,085 BTC as of June 30, 2021. Saylor doubled down on his crypto strategy late July and pledged to continue to accumulate more BTC. The firm announced earlier in June a $400 million debt raise to expand its Bitcoin Treasury holdings. In August, MicroStrategy added another 3,907 BTC to their holdings. This brings its total to 108.992 BTC at a cost to the company of $2.918 billion.
Related: Why did MicroStrategy adopt Bitcoin? Why will others too?
MicroStrategy stock has fallen by 9.4% and 77% respectively over the past six month. Ed Moya, Oanda’s senior market analyst, said that Phong’s and Lang’s selloffs will not discourage MicroStrategy shareholders who support Saylor’s dedication to Bitcoin. He stated that Saylor’s “relentless support” for Bitcoin means that the share price “will likely continue to move in the direction of Saylor, and his bets on Bitcoin.”