B HODL's Stock Surges 67% as Company Continues to Buy More Bitcoins
B HODL's stock price surged 67% in a month and 29% in just one week, making it one of the top performers in the crypto market. The company's latest move was to buy another Bitcoin, bringing its total treasury to 167.487 coins. This purchase is significant because it shows that B HODL is following the same strategy as MicroStrategy, which involves buying more Bitcoins and selling shares to fund these purchases.
Despite the impressive stock price increase, B HODL's Bitcoin holdings are still underwater on average cost basis. The company paid roughly $110,129 per coin for its total stack, but Bitcoin is trading at around $77,658. This means that B HODL's treasury remains 29% underwater.
The strategy of buying more Bitcoins and selling shares to fund these purchases may seem counterintuitive, but it has worked so far for companies like MicroStrategy and B HODL. However, this approach also carries significant risks, including the possibility of dilution and a decline in the value of the company's treasury.
B HODL's use of an at-the-market share issuance program to fund its Bitcoin purchases is similar to MicroStrategy's strategy. This program allows companies to sell shares into strength and use the proceeds to buy more Bitcoins. While this approach has worked for B HODL so far, it remains to be seen whether it can scale down to smaller companies without breaking.