TLDR
- SharpLink Gaming (NASDAQ: SBET) authorized a $1.5 billion stock buyback program as part of its capital strategy
- The stock jumped 15.69% to $20.87 on Friday as Ethereum hit a new record high of $4,866
- SharpLink holds 740,800 ETH worth $3.14 billion, making it the second-largest corporate Ethereum treasury
- Company recently acquired 143,593 ETH for $667 million, raising its treasury above $3.2 billion
- Stock buybacks will be considered when shares trade at or below net asset value of Ethereum holdings
SharpLink Gaming stock rocketed 15.69% higher on Friday to close at $20.87. The move came as Ethereum reached a fresh all-time high of $4,866 during trading.
The rally followed Federal Reserve Chairman Jerome Powell’s hints about rate cuts starting next month. This sparked a broader rally across both cryptocurrency and stock markets.
SharpLink’s surge makes sense given its heavy Ethereum exposure. The company holds 740,800 ETH worth approximately $3.14 billion. This makes it the second-largest corporate Ethereum treasury globally.
The gaming platform announced a $1.5 billion stock repurchase program on Friday. Co-CEO Joseph Chalom said the company will consider buybacks when shares trade at or below the net asset value of its Ethereum holdings.
“This program provides us with the flexibility to act quickly and decisively if those conditions present themselves,” Chalom stated. No repurchases have been made yet under the new program.
Building the Ethereum Treasury
SharpLink has been aggressively accumulating Ethereum tokens. Earlier this week, the company acquired 143,593 ETH at an average price of $4,648 for a total cost of $667 million.
This purchase boosted SharpLink’s total Ethereum treasury above $3.2 billion. The company raised $1 billion in fresh funds over recent months specifically to buy more Ethereum.
SharpLink’s strategy focuses on accumulating and staking Ether to boost its ETH-per-share metric. The company believes repurchasing shares below net asset value would increase this ratio further.
The betting platform made a dramatic shift to an Ethereum-focused strategy in late May. At that time, it nominated Ethereum co-founder Joseph Lubin as chairman.
The company declared that “ETH will serve as the Company’s primary treasury reserve asset.” This represented a complete transformation of its business model.
Lubin has been vocal about the importance of corporate Ethereum treasuries. In July, he said such companies are “a great business to run” and “critical to enable the supply-demand dynamics of Ether.”
Market Position and Competition
Despite its large holdings, SharpLink doesn’t lead the corporate Ethereum treasury race. BitMine holds the top spot with 1.5 million Ether worth $6.47 billion.
SharpLink’s 740,800 ETH represents less than half of BitMine’s position. However, both companies saw their stocks rally on Friday’s Ethereum price action.
BitMine shares jumped 12.07% as investors connected the dots between Ethereum’s record high and these treasury plays.
SharpLink currently sits on unrealized gains of nearly $600 million from its Ethereum position. The recent price surge has pushed those paper profits even higher.
The company’s stock performance closely tracks Ethereum’s price movements. This correlation has become more pronounced since the treasury strategy pivot.
Friday’s trading session demonstrated this relationship clearly. As Ethereum broke to new highs, SharpLink shares followed with their own double-digit gain.
