Simply put
- BlackRock’s Ethereum ETF (ETHA) has reached significant milestones in just 251 days, making it the third fastest ETF to hit $10 billion, despite its initially tepid reception compared to Bitcoin ETFs.
- MicroStrategy is looking to raise as much as $2.5 billion by issuing new preferred stocks to buy more Bitcoin, while also dealing with property lawsuits stemming from past stock offers.
- Mara Holdings saw its stock drop 12% following an announcement of a $950 million increase in debt, planned for operations and acquisitions, not just for Bitcoin purchases.
Public keys are a weekly summary from Decryption, tracking major publicly traded crypto companies.
Eta hits warp speed
BlackRock’s iShares Ethereum ETF, traded under the ETHA ticker, has become the third fastest ETF to reach $10 billion.
The fund reached this milestone in 251 days, only outpaced by BlackRock’s iShares Bitcoin Trust and Fidelity’s Wise Origin Bitcoin Fund.
When the Spot Ethereum ETF launched in January 2024, it didn’t generate the same buzz as Bitcoin did earlier that month, leaving Wall Street puzzled. Trading volume was $1 billion for the ETH fund’s debut, while Bitcoin saw $4.5 billion.
Yet, it seems investors are less worried now.
There are hints that crypto ETFs might gain traction soon. An analyst mentioned that Bitcoin and Ethereum ETF issuers might get approval from the SEC to facilitate share creation and redemption.
This would allow stocks to be bought with BTC or ETH and for investors to receive them upon redeeming shares, which sounds appealing. But regulators are concerned that the process may be overly complex and could raise security issues.
Stretching and a lawyer
MicroStrategy is back in the market, this time aiming to raise cash through a new preferred stock offering to buy more Bitcoin, potentially adding up to $2.5 billion.
As of now, their 607,770 Bitcoin are worth about $70.6 billion, with unrealized profits hitting 1,519.17% after boosting their holdings by $739.8 million recently.
Initially, the company planned to raise $500 million by selling shares at $100 each, but they’ve since decided to go for a larger offering.
A recent SEC filing revealed their intent to raise nearly $2.5 billion through new preferred stock.
However, they are also facing a class-action lawsuit regarding amendments to the delivery terms of these preferred stocks, filed on July 21. Shareholders claim they should have been able to vote on these changes.
In related news, the deadline has passed for selecting a lead plaintiff in another class-action suit concerning executives’ statements on Bitcoin’s associated risks.
Minor problems
For those involved in Bitcoin mining, it looks like debt is the strategy to acquire more Bitcoin.
This seems to be the case for Mara Holdings, whose stock tumbled after announcing a significant salary increase, leading to a further decline when they disclosed a debt spike to $950 million.
Currently, their Bitcoin holdings—worth $5.8 billion—are almost equal to their market cap, which stands at around $6 billion.
Yet, the company isn’t solely focused on buying Bitcoin with these funds. They mentioned plans for “working capital, strategic acquisitions, expanding existing assets, and repaying obligations.”
Mara’s stock is down about 12% this week, falling from $19.98 to $17.15.
Interestingly, analysts see this dip as a minor issue.
A Compass Point analyst upgraded Mara from “sell” to “neutral,” raising the price target from $9.50 to $18 while advising that investors should brace for potential pullbacks during August.
The enhancements stem largely from Bitcoin’s recent performance. However, it’s not the whole story.
While many miners are shifting to high-performance computing setups, Mara seems committed to a strategy focused on retaining Bitcoin instead of selling it, opting for convertible debt sales.
The company has yet to disclose their return on investment as they increasingly leverage their Bitcoin holdings for yield generation.
Other keys
- “Scam” backed loans: Reports suggest JP Morgan, whose CEO previously labeled Bitcoin a “fraud,” might consider allowing clients to use Bitcoin and Ethereum as loan collateral.
- XRP flip-flop: XRP’s market cap briefly surpassed that of major companies like PepsiCo and Uber before falling again, risking dropping below $3 and reducing its market value to $181 billion.
