- Jiuzi Holdings plans to invest up to $1 billion in Bitcoin, Ethereum, and BNB as part of its new crypto treasury strategy.
- The company’s board approved the plan, but Jiuzi Holdings reported less than $1 million in cash as of October 2024.
- The firm’s stock, JZXN, initially surged on the news but later dropped nearly 10% on the day.
- The cryptocurrency investments will focus on long-term value, not short-term trading or speculation.
- Any future crypto token purchases beyond BTC, ETH, and BNB will require separate board approval.
Jiuzi Holdings, a publicly traded electric vehicle charging company, has announced plans to purchase and hold up to $1 billion in Bitcoin, Ethereum, and BNB as part of a new crypto-focused treasury strategy. The decision was made after the company’s board of directors approved the policy, authorizing the move to diversify its assets.
According to its most recent financial filing as of October 31, 2024, Jiuzi Holdings held about $943,000 in cash and equivalents, while reporting a net loss of approximately $55 million for the fiscal year ending on that date. The company stated it will use a strict risk management framework to guide the allocation of funds into the selected cryptocurrencies.
The initial announcement caused Jiuzi Holdings shares (JZXN) to spike by 47% to $2.38, but the gains reversed quickly and shares fell to $1.46, down nearly 10% for the day. Over the past five years, the stock has dropped more than 99.9% in value.
CEO Tao Li said in a statement: “Adopting the crypto asset investment policy represents a proactive step in our treasury management to safeguard and enhance long-term shareholder value.” Newly appointed COO Dr. Doug Buerger added: “We are not engaging in short-term trading or speculation; rather, we view crypto assets as long-term stores of value to hedge against macroeconomic uncertainties.” The company will not take direct custody of its crypto assets, and has created a crypto risk asset committee to oversee the investments.
While the board approved the purchase of up to $1 billion in crypto, there is no public information about how Jiuzi Holdings will raise funds given its current cash position. Some companies finance similar strategies through convertible notes or private equity placements, but Jiuzi Holdings has not specified its approach. Future purchases of crypto assets beyond Bitcoin, Ethereum, and BNB will require explicit approval from the board.
The firm’s latest financial details are available in its filing with the SEC.
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