A harsh crypto winter that might destabilise the market is currently affecting major U.S. crypto exchange CoinbaseCOIN and Bitcoin.
Over the past year, the price of bitcoin has plummeted amid a “panic” in the market that has reduced Coinbase’s worth by 80%. The second-largest cryptocurrency after bitcoin, Ethereum, has also fallen.
Coinbase CEO Brian Armstrong has now disclosed he will sell 2% of his Coinbase holdings over the next year, intending to use the money to finance scientific research and businesses. This comes as JPMorgan and PayPal argue in favour of bitcoin.
Armstrong, who owns 16% of Coinbase and over 60% of the voting shares, tweeted, “I want you to hear it from me first.” He is excited about advancing science and technology to help address some of the most pressing global issues.
Armstrong declared he would invest the proceeds from the sale in businesses “such” the life sciences firm Newlimit and the self-described “GitHub for science,” Researchhub.
Armstrong created Coinbase in 2012, and in April of last year, the company went public by issuing its shares on the Nasdaq exchange. The company’s valuation has since plummeted alongside the price of bitcoin, ethereum, and other cryptocurrencies, going from a peak of roughly $400 to barely $63 at Friday’s market close.
In the second quarter of this year, Coinbase recorded a net loss of $1.1 billion while falling short of analysts’ sales forecasts. On November 3, the business will release its third quarter results.
According to reports, four members of Coinbase’s top management team sold $1 billion worth of shares for values ranging from $189 to $422, with Armstrong selling his shares for over $300 million.
For the avoidance of doubt, Armstrong stated that he intended to remain CEO of Coinbase for a very long time and that he was “very positive on cryptocurrency and Coinbase. He is entirely committed to expanding their company and furthering their cause, but he is also eager to make a different kind of contribution.
Armstrong told Ferris that when Coinbase listed on the Nasdaq, over a thousand billionaires were minted.
