Shares of Bit Digital slipped nearly 4% on Wednesday after the cryptocurrency mining company revealed plans to exit Bitcoin mining and redirect its focus toward Ethereum. The firm intends to sell off or wind down its Bitcoin mining infrastructure and use the proceeds to expand its Ether holdings.
In an official statement, Bit Digital said it will gradually convert its entire Bitcoin (BTC) reserve into Ether (ETH), though no timeline for the transition was provided.
Bit Digital aims to reposition itself as a “pure play Ethereum staking and treasury company.” The company began acquiring ETH for its treasury and building out Ethereum staking infrastructure in 2022.
As of March 31, Bit Digital held 24,434.2 ETH and 417.6 BTC. A full conversion of its Bitcoin holdings at current rates would add over 18,000 ETH to its balance sheet, boosting its total ETH reserves to more than 42,000.
Additionally, the company announced plans to issue new shares, with the net proceeds earmarked for further Ether acquisitions. Cointelegraph reached out for comment, but Bit Digital had not responded by the time of publication.
Stock slides following shift to Ether strategy
Investors reacted negatively to Bit Digital’s decision to move away from Bitcoin, sending its stock (BTBT) down 3.69% to $2.35 during Wednesday’s trading session. The decline continued after hours, with shares slipping another 3.83% to $2.26, according to Google Finance.
Bit Digital’s stock has dropped nearly 25% year-to-date and is down 39% from its January 6 peak of $3.88.
For the first quarter ending in March, the company reported an 18% year-over-year decline in net revenue, while its net profit margin plummeted by 240%.
In a strategic move to expand its AI and high-performance computing capabilities, Bit Digital acquired an industrial facility in Madison, North Carolina, for $53 million in April.
An increasing number of firms are shifting their focus toward Ethereum
Several publicly traded companies have ramped up their exposure to Ethereum in recent weeks.
On June 13, sports betting firm SharpLink Gaming made headlines by purchasing $463 million worth of ETH, becoming the largest publicly traded holder of Ether globally. The company followed up with an additional $30 million ETH purchase on Tuesday.
According to Strategic ETH Reserve, a platform that tracks institutional holdings of over 100 ETH, Bit Digital now ranks as the third-largest publicly traded holder of Ether, trailing behind SharpLink in first place and crypto exchange Coinbase in second.
