According to a CNBC analysis of Canadian Securities Exchange filings, Steve Ehrlich, CEO of the now-bankrupt crypto broker Voyager Digital, sold more than $30 million in company shares in 2021.
The company’s shares typically traded at around $1 after being listed on the Canadian Securities Exchange in 2019 for $0.62 per share under the ticker VYGR. However, following VYGR’s transfer to the Toronto Stock Exchange in 2021, the stock shot up to an all-time high of $27.39 in the spring of that year, right around when Ehrlich made a profit.
On July 5, the same day the company filed for bankruptcy, the VYGR shares were removed from the TSX.
Ehrlich said in a statement about the bankruptcy,
“The sustained volatility and contagion in the crypto markets over the past few months, and the default of Three Arrows Capital on loan from the company’s subsidiary, Voyager Digital, LLC, require us to take deliberate and decisive action now.”
Other Major Instances of Insider Trading
Selling company stock by a CEO is neither unusual nor suspicious. Insider sales totaled $69 billion last year, according to a CNBC report based on InsiderScore/Verity analysis of Securities and Exchange Commission filings. According to the report, that represents a 30% increase over 2020 and a 79 percent increase compared to the 10-year average.
According to SEC filings, Microsoft CEO Satya Nadella sold $285 million of MSFT shares in November. According to SEC filings, Elon Musk, the CEO of Tesla, notably sold $8.4 billion worth of TSLA shares in April after declaring his $43 billion offer to buy Twitter.
Although neither Microsoft nor Tesla have sought Chapter 11 bankruptcy protection, unlike Voyager Digital, many users are unsure when they will be able to access their accounts once again. Additionally, it’s important to note that maintaining one’s integrity or not cashing out is highly regarded in the cryptocurrency community.
Voyager and FTX CEO Sam Bankman-Fried have argued since the company filed for bankruptcy protection over “a low-ball bid dressed up as a white knight rescue.”
Bankman-Fried had proposed that his company, Alameda Research, buy all digital assets “at fair market value,” except those connected to bankrupt hedge fund Three Arrows Capital, and drop its $75 million claim with Voyager.
The Federal Deposit Insurance Corporation has also requested that the company stop making “false and misleading” statements about the government of the United States ensuring customer funds.