SharpLink Gaming, a company that pivoted from sports betting marketing to holding Ethereum, announced a significant $400 million share sale to bolster its cryptocurrency holdings. Despite the substantial capital raise, the company’s stock experienced a notable dip following the announcement, though it showed signs of recovery in after-hours trading.
Key Takeaways
- SharpLink Gaming secured $400 million through a share purchase agreement with five global institutional investors.
- The funds are earmarked to increase the company’s Ethereum holdings, which are projected to exceed $3 billion.
- The company’s stock (SBET) fell over 6.6% on Monday but recovered some losses in after-hours trading.
- SharpLink is a major holder of Ether among public companies, with Ethereum co-founder Joseph Lubin serving as its chair.
Strategic Capital Infusion
SharpLink Gaming entered into a share purchase agreement for the sale of securities at $21.76 per share, expecting to raise a total of $400 million. This deal, slated to close on Tuesday, is part of a broader strategy to significantly expand its Ethereum (ETH) reserves. The company currently holds the second-largest Ether holdings among public companies, trailing only BitMine Immersion Technologies. This latest capital injection follows a series of recent fundraising efforts, including a $200 million deal announced earlier in the week and a $264.5 million at-the-market offering. In total, SharpLink has raised nearly $900 million in the past week.
Market Reaction and Company Outlook
Following the announcement of the $400 million share sale, SharpLink’s stock (SBET) closed Monday down over 6.6% at $22.34. However, the stock showed resilience, gaining nearly 3.5% in after-hours trading to reach $23.10. This dip reversed some of the stock’s recent gains, which had seen it rise over 189% year-to-date since it began accumulating Ether in May. SharpLink co-CEO Joseph Chalom expressed confidence in the company’s strategy, stating that the recent investments underscore market confidence and the growing recognition of Ethereum’s potential.
Ethereum’s Resurgence
The capital raise by SharpLink occurs as Ethereum experiences a notable comeback. After a period of lagging behind Bitcoin, ETH has climbed significantly in the past 30 days, nearing its all-time high. As of Monday, Ether was trading around $4,300, just over 12% shy of its November 2021 peak. This upward trend in Ether’s value likely contributes to the confidence SharpLink and other companies are placing in their Ethereum treasury strategies.
Sources
- SharpLink Shares Drop on $400M Deal to Fuel ETH Buys, Cointelegraph.
- SharpLink Gaming (SBET) Ends 5-Day Run on Planned $400-Million Share Sale, Yahoo Finance.
