Trump Media & Technology Group announced that it has raised $2.5 billion to create a Bitcoin treasury as part of the company's reserves. Shortly after, U.S. listed company SharpLink Gaming, Inc. (NASDAQ: SBET) also announced a bold strategic transformation plan on May 27, through a $425 million private sale financing, to purchase ETH as the company's primary treasury reserve asset, which can be regarded as the "ETH version of MicroStrategy."
Who is SharpLink Gaming?
Last Tuesday, SharpLink Gaming was also a sports betting marketing company with a market cap of just about $2 million and a stock price hovering around $2.91. Despite its listing on the NASDAQ, it is in a difficult position. A reverse stock split was conducted just a few weeks ago to maintain the minimum requirement for a share price of not less than $1 on the Nasdaq, and its shareholders' equity failed to meet the minimum $2.5 million standard set by the Nasdaq. In an effort to restore compliance, SharpLink announced a $4.5 million equity issue at $2.94 per share, revealing that some of the funds could be used to purchase cryptocurrencies "in line with the treasury management strategy being considered."
As a smaller, relatively single-business listed company, SharpLink possesses a rare and precious resource - the "shell of a U.S. listed company." In the market environment of 2025, this "shell resource" becomes an ideal vehicle for entrepreneurs in the crypto field to achieve arbitrage. For investment institutions holding crypto assets, acquiring a small listed company and transforming it into a "crypto vault company" is undoubtedly a shortcut to obtaining high valuations at a low cost.
SharpLink's $425 million private placement is a reflection of this logic. According to the announcement, the company issued about 69.1 million common shares at a price of $6.15 per share ($6.72 for management team members), and the proceeds will be mainly used to purchase Ethereum, making it a core asset of the company's treasury. The transaction was led by blockchain technology company Consensys with participation from well-known crypto venture capitalists such as ParaFi Capital, Electric Capital, Pantera Capital, Galaxy Digital, and personal investments from Rob Phythian, CEO of SharpLink, and Robert DeLucia, Chief Financial Officer. The deal is expected to close on May 29, and Joseph Lubin, co-founder of Ethereum and CEO of Consensys, will become chairman of SharpLink's board of directors after the transaction closes.
"E Guardians", keep up with the rhythm
SharpLink's strategy quickly ignited enthusiasm in the capital markets. On the day of the announcement, the stock price soared to an intraday high of $53.45 from $6.72 in the previous session, and finally closed at $44.74, an increase of more than 650%. As of 1:30 p.m. on May 28, the stock price was stable at around $35, with a market capitalization of $2.5 billion. In other words, SharpLink generated a book valuation of about $2.5 billion through a $425 million funding round, which is a textbook example of the "crypto vault company" model.
It's worth noting that SharpLink doesn't currently hold any Ethereum, and investors are offering USD instead of ETH. This means that SharpLink's strategy is not to "load" existing crypto assets into listed companies, but to take advantage of the high premium of the U.S. stock market for crypto assets to implement an open arbitrage operation. As the market commentary pointed out, "If the U.S. stock market is willing to buy $1 ETH for $6, any investor with hundreds of millions of dollars in cash in hand can easily make more than 5 times the book profit by buying cryptocurrency and putting it into the shell of a listed company."
The Ethereum market was also boosted. After the announcement, the ETH price rose 4% within 24 hours, reaching $2639, with a cumulative increase of 50% over the past month. Although Ethereum has fallen 31% in the past 12 months, SharpLink's initiative has injected new narrative momentum into the market, and some analysts believe this could drive the mainstream adoption of Ethereum as a "digital reserve asset."
This strategy is further strengthened by the partnership with Consensys, with the addition of Ethereum co-creator Lubin not only bringing technical expertise to SharpLink, but also providing a strong endorsement for its position in the Ethereum ecosystem. "This is an exciting time, and I'm excited to work with the SharpLink team to bring Ethereum opportunities to the public market," Lubin said in the statement. His involvement shows that SharpLink's strategy may not be limited to asset allocation at the financial level, but may also involve the deep integration of blockchain technology in its core business, such as the use of smart contracts to optimize payment settlement or data transparency in the gaming industry.
"The Crypto Vault Company" Enters an Arbitrage Game
SharpLink may be a microcosm of the explosive growth of the "crypto vault company" model this year. Since 2020, MicroStrategy has become a pioneer of this model by accumulating $64 billion worth of BTC through large-scale Bitcoin purchases. Its success has inspired many companies to follow suit, including Semler Scientific and Metaplanet, which have both invested in Bitcoin, while Upexi and DeFi Development Corp. have chosen Solana, and the Canadian company Spirit aims to become the "MicroStrategy of Dogecoin."
Related Reading: "Public companies kick off $500 million 'buy buy buy' model, SOL becomes the next BTC for MicroStrategy"
Bloomberg's chief financial writer Matt Levine pointed out that the case of SharpLink vividly demonstrates the "temptations" and challenges of the "crypto vault company" model. From the perspective of opportunity, this model leverages the valuation premium of crypto assets in the U.S. stock market, providing a fast track for small public companies to boost their market value. SharpLink's market value skyrocketed from 2 million dollars to 2.5 billion dollars, reflecting this arbitrage logic. However, the realization of paper profits faces difficulties.
Because private placements often have a lock-up period, 97% of the shares held by investors such as Consensys will be difficult to sell in the short term. SharpLink's average daily volume over the past year was only about 75,000 shares, and it could take more than three years to liquidate all of them. What's more, in the event of a massive sell-off, the stock price could collapse quickly, and the $2.5 billion valuation on the books would be difficult to deliver. This is the typical dilemma of the "crypto vault company" model: although the paper wealth is attractive, how to "settle in the pocket" is still a difficult problem.
Similar scenarios are not unfamiliar in the crypto industry. During the 2022 FTX collapse, SBF created hundreds of billions of dollars in paper valuation through self-created tokens, but when market confidence collapsed, these tokens quickly went to zero. Although the SharpLink case occurred in the U.S. stock market, it is essentially a continuation of the "crypto wealth story": generating hype through high valuations, but struggling to convert it into real money.
Another noteworthy case is the "arbitrage" incident of Mango Markets in 2022. Trader Avi Eisenberg manipulated the price of MNGO tokens to borrow over $100 million in crypto assets from the platform, sparking intense debates about "code is law." Although Eisenberg was ultimately sentenced for other charges, his case revealed the conflict between the regulatory and ethical boundaries of the crypto market and traditional finance. Investors in SharpLink may also need to be wary of similar risks: while high valuations bring prestige and resources, if they cannot be effectively monetized, they may just be a "showy magic trick."
Related Reading: "Stock Market Inflow of 'Bitcoin Fentanyl'"
SharpLink Gaming's Ethereum treasury strategy is another example of the rise of the "crypto treasury company" model. Through raising $425 million and the joining of Joseph Lubin, SharpLink not only achieved a market valuation leap but also injected new momentum into the mainstream adoption of the Ethereum ecosystem. However, behind the high valuation lies the challenge of monetization, and SharpLink's future needs to find a balance between technology and finance. As the transaction is completed on May 29, the market will closely watch how it utilizes the Ethereum ecosystem to write the next chapter of its transformation.
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Spent $425 million to do an ETH version of MicroStrategy, "E Guardians" abandon political correctness.
Trump Media & Technology Group announced that it has raised $2.5 billion to create a Bitcoin treasury as part of the company's reserves. Shortly after, U.S. listed company SharpLink Gaming, Inc. (NASDAQ: SBET) also announced a bold strategic transformation plan on May 27, through a $425 million private sale financing, to purchase ETH as the company's primary treasury reserve asset, which can be regarded as the "ETH version of MicroStrategy."
Who is SharpLink Gaming?
Last Tuesday, SharpLink Gaming was also a sports betting marketing company with a market cap of just about $2 million and a stock price hovering around $2.91. Despite its listing on the NASDAQ, it is in a difficult position. A reverse stock split was conducted just a few weeks ago to maintain the minimum requirement for a share price of not less than $1 on the Nasdaq, and its shareholders' equity failed to meet the minimum $2.5 million standard set by the Nasdaq. In an effort to restore compliance, SharpLink announced a $4.5 million equity issue at $2.94 per share, revealing that some of the funds could be used to purchase cryptocurrencies "in line with the treasury management strategy being considered."
As a smaller, relatively single-business listed company, SharpLink possesses a rare and precious resource - the "shell of a U.S. listed company." In the market environment of 2025, this "shell resource" becomes an ideal vehicle for entrepreneurs in the crypto field to achieve arbitrage. For investment institutions holding crypto assets, acquiring a small listed company and transforming it into a "crypto vault company" is undoubtedly a shortcut to obtaining high valuations at a low cost.
SharpLink's $425 million private placement is a reflection of this logic. According to the announcement, the company issued about 69.1 million common shares at a price of $6.15 per share ($6.72 for management team members), and the proceeds will be mainly used to purchase Ethereum, making it a core asset of the company's treasury. The transaction was led by blockchain technology company Consensys with participation from well-known crypto venture capitalists such as ParaFi Capital, Electric Capital, Pantera Capital, Galaxy Digital, and personal investments from Rob Phythian, CEO of SharpLink, and Robert DeLucia, Chief Financial Officer. The deal is expected to close on May 29, and Joseph Lubin, co-founder of Ethereum and CEO of Consensys, will become chairman of SharpLink's board of directors after the transaction closes.
"E Guardians", keep up with the rhythm
SharpLink's strategy quickly ignited enthusiasm in the capital markets. On the day of the announcement, the stock price soared to an intraday high of $53.45 from $6.72 in the previous session, and finally closed at $44.74, an increase of more than 650%. As of 1:30 p.m. on May 28, the stock price was stable at around $35, with a market capitalization of $2.5 billion. In other words, SharpLink generated a book valuation of about $2.5 billion through a $425 million funding round, which is a textbook example of the "crypto vault company" model.
It's worth noting that SharpLink doesn't currently hold any Ethereum, and investors are offering USD instead of ETH. This means that SharpLink's strategy is not to "load" existing crypto assets into listed companies, but to take advantage of the high premium of the U.S. stock market for crypto assets to implement an open arbitrage operation. As the market commentary pointed out, "If the U.S. stock market is willing to buy $1 ETH for $6, any investor with hundreds of millions of dollars in cash in hand can easily make more than 5 times the book profit by buying cryptocurrency and putting it into the shell of a listed company."
The Ethereum market was also boosted. After the announcement, the ETH price rose 4% within 24 hours, reaching $2639, with a cumulative increase of 50% over the past month. Although Ethereum has fallen 31% in the past 12 months, SharpLink's initiative has injected new narrative momentum into the market, and some analysts believe this could drive the mainstream adoption of Ethereum as a "digital reserve asset."
This strategy is further strengthened by the partnership with Consensys, with the addition of Ethereum co-creator Lubin not only bringing technical expertise to SharpLink, but also providing a strong endorsement for its position in the Ethereum ecosystem. "This is an exciting time, and I'm excited to work with the SharpLink team to bring Ethereum opportunities to the public market," Lubin said in the statement. His involvement shows that SharpLink's strategy may not be limited to asset allocation at the financial level, but may also involve the deep integration of blockchain technology in its core business, such as the use of smart contracts to optimize payment settlement or data transparency in the gaming industry.
"The Crypto Vault Company" Enters an Arbitrage Game
SharpLink may be a microcosm of the explosive growth of the "crypto vault company" model this year. Since 2020, MicroStrategy has become a pioneer of this model by accumulating $64 billion worth of BTC through large-scale Bitcoin purchases. Its success has inspired many companies to follow suit, including Semler Scientific and Metaplanet, which have both invested in Bitcoin, while Upexi and DeFi Development Corp. have chosen Solana, and the Canadian company Spirit aims to become the "MicroStrategy of Dogecoin."
Related Reading: "Public companies kick off $500 million 'buy buy buy' model, SOL becomes the next BTC for MicroStrategy"
Bloomberg's chief financial writer Matt Levine pointed out that the case of SharpLink vividly demonstrates the "temptations" and challenges of the "crypto vault company" model. From the perspective of opportunity, this model leverages the valuation premium of crypto assets in the U.S. stock market, providing a fast track for small public companies to boost their market value. SharpLink's market value skyrocketed from 2 million dollars to 2.5 billion dollars, reflecting this arbitrage logic. However, the realization of paper profits faces difficulties.
Because private placements often have a lock-up period, 97% of the shares held by investors such as Consensys will be difficult to sell in the short term. SharpLink's average daily volume over the past year was only about 75,000 shares, and it could take more than three years to liquidate all of them. What's more, in the event of a massive sell-off, the stock price could collapse quickly, and the $2.5 billion valuation on the books would be difficult to deliver. This is the typical dilemma of the "crypto vault company" model: although the paper wealth is attractive, how to "settle in the pocket" is still a difficult problem.
Similar scenarios are not unfamiliar in the crypto industry. During the 2022 FTX collapse, SBF created hundreds of billions of dollars in paper valuation through self-created tokens, but when market confidence collapsed, these tokens quickly went to zero. Although the SharpLink case occurred in the U.S. stock market, it is essentially a continuation of the "crypto wealth story": generating hype through high valuations, but struggling to convert it into real money.
Another noteworthy case is the "arbitrage" incident of Mango Markets in 2022. Trader Avi Eisenberg manipulated the price of MNGO tokens to borrow over $100 million in crypto assets from the platform, sparking intense debates about "code is law." Although Eisenberg was ultimately sentenced for other charges, his case revealed the conflict between the regulatory and ethical boundaries of the crypto market and traditional finance. Investors in SharpLink may also need to be wary of similar risks: while high valuations bring prestige and resources, if they cannot be effectively monetized, they may just be a "showy magic trick."
Related Reading: "Stock Market Inflow of 'Bitcoin Fentanyl'"
SharpLink Gaming's Ethereum treasury strategy is another example of the rise of the "crypto treasury company" model. Through raising $425 million and the joining of Joseph Lubin, SharpLink not only achieved a market valuation leap but also injected new momentum into the mainstream adoption of the Ethereum ecosystem. However, behind the high valuation lies the challenge of monetization, and SharpLink's future needs to find a balance between technology and finance. As the transaction is completed on May 29, the market will closely watch how it utilizes the Ethereum ecosystem to write the next chapter of its transformation.
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