- Sharplink Gaming shares dropped nearly 67% in after-hours trading, falling from $33 to under $11 on NASDAQ.
- The company lost 91% of its market value over two weeks, sliding from $124 per share to its current price.
- The sharp decline followed announcements related to a large resale registration for more than 58 million shares, tied to Sharplink’s ETH Treasury Strategy.
- Trading volume surged to over ten times the average, setting a new single-day loss record for the stock.
- Company leaders and legal experts say the filings are routine and do not reflect immediate share sales, calling the reaction excessive.
Sharplink Gaming, a major holder of Ethereum (ETH) reserves, saw its stock price collapse after regular trading hours. On NASDAQ, the company’s shares fell from $33 at the closing bell to below $11 by 8pm. The price was $124 per share just two weeks ago.
The drop came after a surprise announcement about shareholder dilution. A viral social media post described how participants in a recent private placement were moving to sell their shares less than a month after a new ETH-focused treasury strategy was launched. Trading volume spiked more than tenfold, and the company’s share price saw its largest single-day percentage loss to date.
Lawyer Matt Corva from ConsenSys, the Ethereum conglomerate led by Joe Lubin, said that the Form S-3ASR filed by Sharplink was a routine resale registration with the Securities and Exchange Commission (SEC). According to Corva, the filing does not indicate that actual sales took place, stating in a public comment it was “just a bunch of FUD by people who clearly don’t understand.” Despite these reassurances, after-hours traders continued to sell off shares.
The filing was related to the resale of more than 58 million shares that Sharplink issued as part of a capital raise to purchase ETH. This followed the company’s larger plan to position itself as a leading corporate holder of non-Bitcoin crypto, with the company raising $450 million to build its ETH treasury. Joe Lubin, founder of ConsenSys, is chairman at Sharplink.
Before this recent collapse, Sharplink was aiming to be a model for other crypto treasury companies. The pace of its crash and the spike in trading activity prompted major concern among both investors and market observers.
Additional context can be found in Protos’ coverage, including a report on a related lawsuit involving ConsenSys.
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