ETHZilla Shares Drop Nearly 30% Amid Convertible Share Offering Concerns
Shares of ETHZilla (ETHZ) fell nearly 30% after the company announced a shareholder offering of up to 74.8 million convertible shares, raising concerns about dilution for existing shareholders.
- Outstanding shares will increase by approximately 46% from 164.4 million to 239.3 million.
- The company will not receive proceeds from the share sales.
- ETHZilla recently rebranded from 180 Life Science to a crypto treasury company.
- The firm holds 82,186 ether, valued at around $349 million, and $238 million in cash equivalents.
- The average purchase price of ether was $3,806.71 per token.
- Peter Thiel's Founders Fund owns a 7.5% stake in ETHZ, betting on Ethereum's role in new financial infrastructure.
- Ether has increased by 38% year-to-date, outperforming bitcoin's 24% rise amid regulatory clarity in the U.S.
Despite broader market gains, including a 9% increase in ether over the past 24 hours, ETHZ shares experienced a selloff due to investor concerns regarding potential dilution versus the company's large ether holdings.