The enterprise software company MicroStrategy has caused a stir in the crypto and financial industry because the CEO has been relying on Bitcoin since 2020. Some reporters quipped that the company has since been more into a Bitcoin (BTC) investment vehicle than a software company.
Recent filings with the SEC suggests that some of the company’s top executives are uncertain about this strategy over the long term.
The records indicate that MicroStrategy chief financial officer Phong Le and technology director Timothy Lang dropped shares in August this year. They sold about 30 percent of the shares they had received as compensation.
As reported by Bloomberg, Lang sold 10,000 of his shares for around $ 7.1 million on Aug. 26. Phong sold 20,000 shares for a little over $ 7.3 million between Aug. 2 and Aug. 6. Both now only hold about 20,000 shares.
CEO Michael Saylor has not sold any shares since 2012. He merely switched 50,000 Class A shares in the company to another of his firms, Alcantara LLC, in January.
The report said that while it was common for executives to sell shares, Phong and Lang acted without a pre-agreed trading plan. Matt Maley, Miller Tabak + Co.’s chief marketing strategist, has claimed this move is an indication of her concerns about the long-term viability of Saylor’s corporate strategy of tying the company’s fate so closely to Bitcoin’s development. “Executives don’t sell stocks if they think they’re going to go up. That’s just a bad sign, no matter how you turn it around,” said Maley.
MicroStrategy owns around 105,085 BTC (as of June 30, 2021). Saylor showed at the end of July that he was convinced of his crypto strategy and announced that he would buy more BTC. In early June, the company announced it would take out $ 400 million in debt in order to buy more Bitcoin. In August, MicroStrategy bought an additional 3,907 BTC, now holding a total of 108,992 BTC, which cost the company $ 2.918 billion.
In this context: Three reasons: Why MicroStrategy got into Bitcoin and why others will too
At the time of going to press, MicroStrategy stock is down just under 9.4 percent for the day and just over 77 percent for the past six months. However, Ed Moya, a senior market analyst at Oanda, believes Phong and Lang’s sales are unlikely to discourage MicroStrategy investors who share Saylor’s belief about Bitcoin. Saylor’s “belief in Bitcoin has turned the company into a cryptocurrency trading company. You don’t necessarily bet on the company’s software solutions and services”. He added, “The share price will likely continue to align with Saylor and his belief in Bitcoin.”