Chinese microchip firm Nano Labs has initiated its ambitious plan to accumulate a significant portion of BNB's circulating supply. The company recently completed its first purchase of $50 million worth of BNB, marking a step towards its long-term goal of holding up to 10% of the cryptocurrency. This move, however, has been met with a mixed reaction from the market.
Nano Labs' Ambitious BNB Accumulation
Nano Labs, founded in 2019 by Kong Jianping and Sun Qifeng, specializes in high-throughput and high-performance computing chips. The company went public in 2022 and has now set its sights on a substantial investment in BNB. Their stated long-term objective is to acquire up to $1 billion worth of BNB, aiming to hold between 5% and 10% of its total circulating supply.
Following this initial $50 million purchase, Nano Labs' total crypto holdings, including BNB and Bitcoin, are now approximately $160 million.
Market Reaction and Challenges Ahead
Despite the significant investment, the market's response to Nano Labs' first BNB acquisition has been subdued. While an earlier announcement of a plan to issue $500 million in convertible notes for a BNB treasury had initially boosted Nano Labs' stock by over 106%, the recent purchase did not yield similar enthusiasm.
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Nano Labs' stock price dropped over 4.7% during Thursday's regular trading session and an additional 2% after hours, closing at $8.21.
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BNB saw only a slight increase of 0.3% in the last 24 hours, trading around $663 per coin.
Achieving the 10% BNB ownership goal presents a considerable financial undertaking. With BNB's market capitalization at $93.4 billion and a circulating supply of approximately 145.8 million coins, acquiring 10% would cost roughly $926 million at current market prices. This is further complicated by Binance's ongoing token burns, which gradually reduce the total circulating supply.
The Broader Perspective on Crypto Treasuries
The trend of companies holding cryptocurrency in their treasuries is growing, but not without skepticism. Anthony Scaramucci, founder of SkyBridge Capital, has expressed doubts about the long-term viability of this strategy. He suggests that investors might question the rationale of investing in a company that holds a valuable asset when they could simply purchase the asset themselves.
Scaramucci, while bullish on Bitcoin and not inherently negative on companies acquiring crypto, advises investors to carefully consider the underlying costs associated with such treasury companies. This perspective highlights a potential challenge for companies like Nano Labs as they pursue significant crypto holdings.
Sources
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Nano Labs Makes First Purchase In Lofty BNB Stockpile Plan, Cointelegraph.
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