Bit Digital’s stock plummeted after announcing a $150 million share sale and a transition from Bitcoin mining to Ethereum staking.
Former Bitcoin mining firm Bit Digital fell sharply this week, with its share price tumbling almost 19% over the five-day period to close at $1.99 on Friday, with a 15% drop in just 24 hours.
The plunge follows major company announcements, including a $150 million public offering and a strategic pivot to Ether staking. On Thursday, the company announced a public offering of 75 million ordinary shares that is intended to raise $150 million.
Bit Digital plans to issue the 75 million ordinary shares at $2 each. The proceeds will be used to purchase Ether (ETH), doubling down on its previous decision to shift to an Ethereum-focused company.
After the news, the company’s stock dipped to as low as $1.86 before recovering slightly during after-hours trading.
Bit Digital pivots into an ETH staking and treasury company
The news follows the company’s decision earlier this week to ditch Bitcoin (BTC) for ETH. On Wednesday, the company revealed it would transition into a “pure-play Ethereum staking and treasury company,” focused on increasing its ETH holdings.
The company said it had accumulated ETH for its treasury reserves and had started its staking infrastructure in 2022. It plans to liquidate its Bitcoin holdings to purchase more ETH.
As of March 31, Bit Digital held 24,434 ETH and 417 BTC, valued at around $44.6 million and $34.5 million, respectively.
When it converts all of its BTC into ETH, the company would have about 42,000 ETH, worth about $103 million at current market prices.
Related: Bitcoin mining firm Bit Digital reports revenues up nearly 40%
Bit Digital stock dips 19% in five days
Investors have reacted unfavorably to the shift. Bit Digital shares dropped nearly 4% on Wednesday following the ETH pivot announcement.
Throughout the week, the company’s stock prices declined by nearly 19%, going from a high of $2.40 to a low of $1.86 on Friday. Despite the reaction, the company showed no signs of stopping its move into ETH.
Bit Digital was the 12th-largest Bitcoin mining company by market capitalization. However, since its ETH pivot, CompaniesMarketCap shows a drop to the 13th spot. The data also shows that its stock prices have declined by over 40% this year.
Cointelegraph reached out to Bit Digital for comment but had not received a response by publication.
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