ETHZilla will sell $74.5 million in Ether to pay off debt, it disclosed in an SEC filing
Crypto treasury company ETZilla said in a filing with US regulators that it sold part of its Ether holdings and sold outstanding convertible notes amid a broader market downturn.
In a filing with the Securities and Exchange Commission, the company announced the sale of 24,291 Ether (ETH) for $74.5 million at an average price of $3,068.69 per token.
The company said it expects to use all or a significant portion of the proceeds to redeem its outstanding senior secured convertible notes.
ETHZilla switched from 180 Life Sciences Corp on July 29, shifting from a biotechnology to an ether-focused investment strategy. In the year The former clinical-stage biotech has seen its shares fall more than 99.9 percent since its announcement in 2020.
The news comes after ETHZilla announced two acquisitions in December, taking a fully diluted 20% stake in automotive-finance AI startup Karus and a 15% stake in digital housing lender Zippy.
Shares of the former biotech company fell 8.7% on Monday and closed the trading session down more than 65%, according to Google Finance data.
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Digital asset treasuries are repositioned when prices fall.
In September, Cointelegraph reported that publicly traded companies have significantly increased their exposure to Bitcoin (BTC) this year. Data from BitcoinTreasuries.NET shows that more than 190 listed companies hold Bitcoin on their balance sheets, with combined holdings accounting for more than 5% of Bitcoin's circulating supply in September.
Ether has seen similar interest from investors. According to CoinGecko, 27 public companies hold a total of 6 million ETH, which represents 5% of the token distribution supply.
As bitcoin retreated from a record high of $126,000 hit on Oct. 6 and surged against altcoins including ether, some digital asset treasury companies are selling assets to shore up their balance sheets.
In late October, Ether's treasury company FG Nexus began selling its coins to fund its share buyback program, liquidating 10,922 ETH along with a separate record of debt to accelerate the buyback. The proceeds were used to repurchase approximately 3.4 million shares at an average price of $3.45 per share.
In November, Sequence Communications said it redeemed 50 percent of its outstanding convertible debt using proceeds from the sale of 970 bitcoins. The transaction reduced its total debt to $94.5 million and reduced the company's bitcoin holdings to 2,264 BTC, down from 3,234 BTC.
On Friday, Strategy, the first public company to adopt a Bitcoin treasury strategy, said it sold 4.535 million Class A shares between Dec. 15 and Dec. 21, selling $747.8 million in cash reserves amid the crypto's decline.
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