SharpLink Gaming plunges following SEC filing
The S-3 registration allows investors to resell shares. The firm also announced Friday it’s acquiring $463 million worth of ethereum.
SharpLink Gaming announced Friday it had acquired $463 million worth of ethereum, claiming to be the largest publicly traded holder of the cryptocurrency, but the news was unable to reverse the downward trajectory of the shares, which had plummeted 70% following a late Thursday release of an S-3 registration statement with the US Securities and Exchange Commission.
“Under this registration statement, the Selling Stockholders may sell from time to time in one or more offerings the Securities described in this prospectus,” the document states.
SharpLink’s stock was at the $32.50 mark as of market close Thursday and fell during extended trading hours to under $9. Today, the stock is up from its premarket lows to roughly $10.75 as of 12:10 p.m. ET.
Joseph Lubin, chairman of the firm’s board of directors, said neither he nor Consensys, which led SharpLink’s investment round last month, have sold any shares.
“This is standard post-PIPE procedure in tradfi, not an indication of actual sales,” Lubin said yesterday evening in an X post about the S-3 registration statement. “PIPE” stands for “private investment in public equity.”
Consensys general counsel Matt Corva said the S-3 registration filing doesn’t reflect investor sales, which may or may not ever happen. “SBET filed about selling the shares two weeks ago, the market knew about that, and now this is the official statement saying yes SBET sold those shares to investors and they count (i.e. are registered),” he wrote on X.
SharpLink stated its plans to offer up to $1 billion in shares of its common stock to buy ethereum in a May 30 SEC filing, which came days after announcing its $425 million capital raise to jumpstart a new corporate strategy for an ethereum treasury.
From May 30 through June 12, the firm sold shares under its $1 billion at-the-market equity program, raising about $75 million in gross proceeds, most of which will be dedicated to buying ethereum, according to the press release, which said the company acquired 76,270.69 ethereum tokens at an average acquisition price of $2,626 per token. It also said that “over 95% of SharpLink’s ETH holdings are actively deployed in staking and liquid staking solutions, contributing to Ethereum’s network security while generating native yield.”
