Nasdaq-listed DigiAsia announced plans to raise $100 million to fund its first Bitcoin acquisition initiative. The company aims to use 50% of future net profits to build a Bitcoin treasury reserve. DigiAsia’s stock surged nearly 91% following the announcement before retreating after-hours.
The company said its board approved the creation of a treasury reserve aimed at long-term Bitcoin exposure. DigiAsia plans to begin its cryptocurrency strategy with proceeds from the proposed capital raise. It also outlined ambitions to generate yield through regulated crypto finance mechanisms.
DigiAsia confirmed it is exploring investment instruments like convertible notes to support its digital asset strategy. Despite recent market volatility, the firm expressed confidence in executing its Bitcoin-focused roadmap. It has initiated discussions with regulated entities to manage crypto-related operations securely and legally.
Bitcoin to form core of DigiAsia’s new reserve strategy
DigiAsia intends to transform its balance sheet strategy by allocating a portion of its profits into Bitcoin holdings. The company views Bitcoin as a long-term reserve asset and part of a broader treasury diversification plan. It expects this move to align with emerging global corporate finance trends.
Bitcoin to form core of DigiAsia’s new reserve strategy
Management approved the reserve plan to secure value through a capped digital currency. DigiAsia said it would commit half its net profit annually to purchase Bitcoin. These funds would be accumulated through internal earnings and capital raised.
DigiAsia is preparing to raise up to $100 million from institutional investors to begin this effort. The firm is considering instruments like crypto-linked debt and equity offerings to secure the funds. After the capital raise closes, it plans to complete the first phase of Bitcoin acquisitions.
DigiAsia stock spikes, then dips, after Bitcoin announcement
On May 19, DigiAsia shares closed 91% higher at $0.36 after announcing its Bitcoin strategy. However, the stock dropped 22% to $0.28 in post-market trading. DigiAsia shares have fallen about 53% year-to-date after peaking at nearly $12 in March 2024.
Investors responded positively to the Bitcoin announcement despite the company’s prior stock performance. The trading activity signals strong market interest in corporate Bitcoin adoption. However, the price correction indicates lingering volatility around crypto-exposed firms.
The Jakarta-based fintech firm seeks to build market confidence by presenting strong growth targets. DigiAsia reported $101 million in revenue for 2024 in April, reflecting a 36% year-over-year increase. It expects $125 million in 2025 revenue and $12 million in earnings before interest and taxes.
Bitcoin leads the way in corporate treasury strategies
Bitcoin continues to gain traction as a corporate treasury asset among public companies worldwide. DigiAsia’s decision follows similar moves by major firms, including MicroStrategy and GameStop. These companies have allocated billions of dollars to Bitcoin for financial diversification.
Bitcoin leads the way in corporate treasury strategies
GameStop raised $1.5 billion through a convertible offering and allocated part of the proceeds to Bitcoin. Strive Asset Management also announced it would shift into a Bitcoin treasury model. Together, such moves are reshaping corporate finance around digital assets.
Bitcoin’s current market cap stands at approximately $2 trillion. Corporations hold over three million Bitcoins worth over $340 billion. DigiAsia aims to join this growing list of firms that are integrating Bitcoin into financial strategy.
FAQs
What is DigiAsia planning with Bitcoin?
DigiAsia plans to raise $100 million and use 50% of net profits to buy and hold Bitcoin as a reserve asset.
Why did DigiAsia shares rise and then fall?
Shares rose 91% after the announcement but dropped 22% after-hours due to market volatility and profit-taking.
How does DigiAsia plan to raise funds?
It will explore issuing convertible notes or other instruments to secure up to $100 million in capital.
How will DigiAsia manage its Bitcoin holdings?
It is working with regulated partners to manage its Bitcoin and to explore yield opportunities through lending and staking.
Is DigiAsia the only company doing this?
No, other companies like MicroStrategy, GameStop, and Strive Asset Management have also adopted Bitcoin treasury strategies.
Glossary of Key Terms
DigiAsia – A Nasdaq-listed fintech company based in Jakarta focused on digital finance solutions in Southeast Asia.
Bitcoin (BTC) – A decentralized digital currency and the first cryptocurrency to gain global adoption.
Convertible Notes – A form of short-term debt that can convert into equity, often used during fundraising rounds.
Treasury Reserve – A portion of company funds held in specific assets, such as Bitcoin, as a long-term store of value.
Yield Generation – Strategies such as lending or staking used to earn returns on held digital assets.
Reference:
CoinDesk
Newsfile
Google Finance
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