How Strategy Insiders Insulated Themselves From the Crash

**David Canellis** (0:00)
Welcome back to The Breakdown. I'm your host, David Canellis, as always. So, I mean, I think everyone is watching the price of Bitcoin right now, and with good reason, because we ran an episode earlier this week that compared the similarities and differences between Strategy and Stretch and Terra Luna in relation to the Bitcoin market. Since then, Stretch has crashed another 15%.
It's now trading at 73.8 in pre-market trade Friday morning. So, since that episode, Stretch has tanked another 15%.
Bitcoin is also on its way down. It's now trading routinely underneath $60,000. Strategy is also on its way down as well, MicroStrategy stock, which means that indirectly, you have gathered up a bunch of exposure just by holding crypto to the reality of what Sailor has cooked up and what Strategy has done to Bitcoin and crypto over the past two or three years. And a lot of us has been super positive. Please don't get me wrong because it has, I mean, it's obvious. It has pumped Bitcoin way past 100K on multiple occasions, reaching I think 124K. And you have to admit that Strategy was a big part of that. And I mean, it kicked off the debt boom. You have companies all around the world stacking Sats, trying to mimic what Sailor has done and trying to ride his coattails all the way to the moon and so on. And that has done untold good. I can't deny that. But so while holders and users and so on might be feeling the hurt right now, Strategy Insiders were able to really insulate themselves from the worst of the market, it seems, going by the amount of shares that they've sold throughout the past bull market with Bitcoin on its way up and Strategy mimicking those moves alongside it. So I'm just going to spend this episode. What we're going to do is we're going to look at the past few years of Strategy Insider stock sales, just to get a sense that those at the top of this plan, I don't think they have much to worry about, it seems. At least going by the data that we can see from the SEC disclosures over the past couple of years. So enough out of me, this is going to be the deal today. Let's take a look. This is The Breakdown.
Nothing is said on The Breakdown as a recommendation to buy or sell securities or tokens. This podcast is for informational purposes only, and any views expressed by anyone on the show are opinions, not financial advice. Hosts and guests may hold positions in the company's funds or projects discussed. Okay, so first, I mean, I just want to preface this a little bit further, in that I am not really looking to demonize the idea that insiders at companies, the executives at public companies, can't make money. They absolutely can. I'm not an anti-capitalist or what have you. I'm pro-transparency, and actually I'm a big fan of how much detail we can see in SEC disclosures about stock sales. And I want the same kind of transparency and disclosures for the crypto space. It would be really cool if we could see which insiders at which crypto currencies or token projects or whatever, which ones have sold and when. It would be cool to also have pre-registered trading plans that can happen programmatically that aren't just actioned because the insider wants to sell at the top or what have you. I want this level of transparency and disclosures for crypto as well. But of course, you're going to see a bunch of numbers that you have insiders selling millions of dollars, tens of millions of dollars, in sailors' case, hundreds of millions of dollars worth of shares.
And it's quite easy to try and spin that up into something that is quite negative. What this is, is just information for you to see that one great way to insulate yourself from the cyclical nature of the Bitcoin and crypto market is to apparently be an executive at a public crypto company and a publicly listed crypto company. And I suppose that goes without saying those that are at the top of the industry, who are on the frontier of all of this technological and financial innovation, they should be rewarded for it. So let's just take a look at the chart as well. I mean, we're also going to have a look at the chart. So this is what's happening. The strategy is in blue, Bitcoin is in orange and stretch preferred stock is in green here. And you can see that over the past year, I mean, this is the whole bull market, the most recent bull market that I have on my screen. This is the view. And you can see that, of course, Bitcoin and strategy would share a very similar trajectory, but micro strategy just amplified exponentially the moves of Bitcoin because everybody piled into strategy because it was buying a bunch of Bitcoin. So we can see that strategy over the past, let's do a five-year view. Over the past five years, strategy at its most was up 700% across a five-year time frame. Bitcoin at its most was up 250% over the same time frame. So yeah, that is what? Three times, nearly two or three times the returns on strategy compared to Bitcoin. What we are now seeing is that the two have flipped, actually. Now Bitcoin has outperformed strategy over the past five years by about double. So all of the volatility, I mean, it's all been wrapped into strategy. But Bitcoin is really filling out right now. When it's under 60k, that has effectively wiped out the second half of the Trump bull run.