SharpLink rises 12% after $1.5 billion share buyback announcement

Shares of SharpLink surged more than 12% on Friday after the betting affiliate turned Ethereum holder unveiled plans to repurchase up to $1.5 billion of its common stock, a move equal to nearly half its $3.05 billion market capitalization.

The Minneapolis-based company has built one of the largest corporate treasuries of Ethereum, funding acquisitions largely through stock issuance. As of mid-August, SharpLink held 740,760 Ether, with its concentration nearly doubling in the past two months to 3.87. The firm recently raised $537 million in a single week, including $390 million from a direct equity offering, lifting its Ether holdings to more than $3.5 billion in value.

If there are periods when SharpLink shares trade at or below the net asset value of the company’s massive Ethereum stake, it wouldn’t be prudent to issue new stock to fund purchases of the cryptocurrency, but that could be an opportune time to buy back stock, co-CEO Joseph Chalom said in a statement, as reported by Casino.org.

“In this scenario, the accretive course of action may be to repurchase our common stock. This program provides us with the flexibility to act quickly and decisively if those conditions present themselves,” said in a press release.

SharpLink said the buyback was intended to “provide enhanced support to the market, optimize capital allocation and reinforce SharpLink’s long-term commitment to driving sustainable stockholder value.”

The company’s strategy has drawn comparisons to MicroStrategy, which has become the largest corporate holder of Bitcoin under executive chairman Michael Saylor.

SharpLink’s staking rewards have also grown since it adopted its crypto treasury approach in June, reaching nearly 1,400 Ether.