Virginia-based business software company Microstrategy has captured the attention of crypto and financial news outlets alike with its CEO’s atypical strategy of betting on Bitcoin, starting in 2020, with some journalists. joking that since then the company has morphed into something more like a Bitcoin (BTC) investment vehicle than a software company.
Recent filings with the US Securities and Exchange Commission suggest that some of the company’s senior executives are ambivalent about pursuing this long-term strategy.
the filings reveal that Microstrategy’s CFO Le Phong and CTO Timothy Lang downloaded shares in August this year by exercising approximately 30% of the options they received as compensation.
Like Bloomberg reports, Lang exercised 10,000 of his options granted on August 26 and then sold all of the converted shares, pocketing approximately $ 7.1 million. Phong, for his part, exercised 20,000 options between August 2 and 6 and later sold the shares for just over $ 7.3 million. Each has held onto roughly 20,000 options.
CEO Michael Saylor has not sold shares since 2012, although he did reallocate 50,000 shares of shares of the Class A company to another of its firms, Alcantara LLC, this January.
The report notes that while exercising options is commonplace for executives, the Phong and Lang moves were made without a pre-established business plan. Matt Maley, chief market strategist at Miller Tabak + Co., said the decision may be indicative of his concerns about the long-term viability of Saylor’s corporate strategy and his commitment to link the company’s fate so closely with that of Bitcoin. “Senior executives don’t sell stocks if they think they’re going up. It’s just a bad sign, no matter how you look at it, ”Maylor reportedly said.
As of June 30, 2021, MicroStrategy had approximately 105,085 BTC, and Saylor doubled down on its crypto strategy at the end of July by committing to continue to accumulate more BTC. In early June, the firm had announced a $ 400 million debt increase to expand its Bitcoin treasury holdings and in August, Microstrategy added another 3,907 BTC to its holdings, bringing its total to 108,992 BTC, at a cost of $ 2,918 billion for the company.
Related: 3 reasons why MicroStrategy embraced Bitcoin and why others will too
At the time of writing, Microstrategy’s shares are down about 9.4% on the day and just over 77% in the last six months. However, Ed Moya, a senior market analyst at Oanda Corp., has argued that the Phong and Lang sell-offs are unlikely to discourage Microstrategy investors who share Saylor’s commitment to Bitcoin, given that the “relentless support of the CEO to Bitcoin has turned the company into a cryptocurrency. ” trading and not necessarily a bet on the company’s software solutions and services. “He added that” the share price will likely continue in the direction of Saylor and his bet on Bitcoin. “