Cango Directors Sell $2M in Shares After Bitcoin Pivot Sparks Rally

Two board members of Cango Inc. are set to sell a combined $2 million worth of the company’s shares following a 280% stock rally sparked by its pivot into Bitcoin mining.

According to new filings made public on Thursday, Cango’s CEO Jiayuan Lin and board director Zhipeng Song plan to sell 100,000 and 200,000 shares of the company, respectively, with the sales scheduled for approximately Dec. 20. The total market value of the shares being sold is estimated at $2.07 million.

The filings indicate that the shares being sold come from stock options granted to the executives on May 25, 2018. Cango’s annual filings show that these options had an exercise price of $0.2951, implying a 23-fold gain.

Founded in 2010, Cango originally served as a digital platform for facilitating automotive loans in lower-tier cities across China. After going public on the New York Stock Exchange in 2018, the company has faced challenges in recent years, with plummeting revenues and its stock price dropping to a 52-week low of $0.96.

In a surprising move last month, Cango announced the acquisition of 32 EH/s of deployed Bitcoin miners from Bitmain as part of its expansion into the Bitcoin mining sector. The company mined 363.9 BTC in November alone. This pivot triggered a 290% surge in Cango’s stock price, which jumped from around $2.80 to $8 as of Wednesday.

Per Cango’s annual report for 2023 filed in March, Lin holds 22.4% of Cango’s shares, making him the second-largest shareholder after the company’s chairman, Xiaojun Zhang, who owns 22.8%. Together, Lin and Zhang control more than 90% of the company’s voting power.