SharpLink shares sink 6 percent despite $400 million capital infusion

SharpLink Gaming saw its stock plummet over 6% in after-hours trade on August 11. The sharp sell-off happened on the back of the company announcing a substantial $400 million capital infusion tied to its Ethereum treasury expansion plan.

The company disclosed that it had entered into multiple securities purchase agreements with five institutional investors with a direct offering priced at $21.76 per share. By August 10, SharpLink already held approximately 598,800 Ether, valued at $2.5 billion. With the new funds and pending proceeds, that treasury value is expected to exceed $3 billion.

Initially, the news sparked enthusiasm, lifting SharpLink’s shares as high as $28. However, investor sentiment swiftly changed and the stock closed the day down 6.6% at $22.34. It is interesting to note that while Sharplink was buckling under selling pressure, another ETH accumulator, BitMine, was soaring to new heights, up 14% in 24 hours.

Source: Yahoo Finance

Some market observers point out that even with aggressive ETH accumulation, the lower multiple of market-to-net asset value (mNAV) compared to peers may temper enthusiasm. Moreso, shorter-term volatility may be factored in, as the firm remains up around 17% for the week.

Betting on ETH Treasuries

A growing number of publicly listed companies are turning to Ethereum as a core treasury asset. Earlier in July, Sharplink hinted that its long-term goal is to hold as much as 1 million ETH in its treasury. Some observers pointed out that even with aggressive ETH accumulation, the lower multiple of market-to-net asset value (mNAV) compared to peers may temper enthusiasm. Moreso, shorter-term volatility may be factored in, as the firm remains up around 17% for the week and about 190% YTD.

At one point, ShapLink was the largest corporate holder of Ethereum, surpassing the Ethereum Foundation. However, it has lost that position to BitMine Immersion Technologies in recent days.