SharpLink Gaming Invests $463 Million in 176,000 ETH, Becoming the Largest Holder Among Public Companies, Yet Stock Price Plummets Nearly 70% Pre-Market Due to Risk Concerns.
(Background: Ethereum Version of MicroStrategy) SharpLink Gaming Plans to Raise $425 Million to Buy ETH, Stock Price Soars 800% in a Single Day
(Context: MicroStrategy’s Michael Saylor: Apple Should Invest in BTC, More Stimulating for Stock Price than Stock Buybacks)
SharpLink Gaming, a public marketing company focused on serving the U.S. sports and global online gaming industry, announced yesterday (13th) that it has acquired 176,271 Ether (ETH) for a total price of approximately $463 million, and immediately staked 95% of its holdings.
Transaction Details
SharpLink Gaming stated that the average purchase cost was $2,626 per ETH, with total expenditures, including fees, amounting to $462,947,816. The funds primarily came from a PIPE completed on May 26 and subsequent ATM fundraising over the following days, totaling approximately $79 million. The company will stake or liquid stake 95% of its ETH, aiming to earn on-chain revenue while enhancing the security of the Ethereum network. After this acquisition, SharpLink Gaming’s ETH holdings rank second only to the Ethereum Foundation.
SharpLink Gaming’s Stock Price Plummets
It is worth mentioning that due to investor concerns over the volatility of crypto assets and accounting treatment risks, SharpLink Gaming (SBET) has experienced a significant drop in stock price. According to real-time quotes from Google Finance, SBET is currently priced at $10.75, down 66.95%, with a trading volume of 10.49 million shares, far exceeding the average of 2.21 million shares over the past 10 days. The stock price hit a low of $10.01 during the day, nearly halving compared to the previous day’s closing price of $32.53. Additionally, some investors misinterpreted the S-3ASR filing as a signal for internal selling, further exacerbating the selling pressure.
ETH Drops 6.6%
Moreover, possibly influenced by military conflicts in the Middle East, SharpLink Gaming’s investment has not provided upward momentum for Ethereum, with ETH dropping 6.6% in the past 24 hours, trading at $2,550 at the time of writing.
Future Variables
SharpLink Gaming’s move has drawn comparisons to MicroStrategy’s strategy of buying Bitcoin. If more public companies follow suit and incorporate ETH into their balance sheets, it could bring new demand for market value and prices. However, the price fluctuations of ETH will directly reflect changes in fair value on financial statements, requiring investors to assess potential risks of dilution or impairment. Chairman and Ethereum co-founder Joseph Lubin stated in a statement:
“This strategic acquisition not only enhances on-chain security but also captures the inherent revenues of the Ethereum network, which is rare in traditional financial assets.”
Future attention should be paid to the direction of U.S. digital asset policy, especially the implementation timeline of the stablecoin and digital asset structural legislation, as these variables will determine whether SharpLink Gaming’s gamble can yield excess returns or become a financial black hole.
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