Overview
- Zhibao Technology, listed on Nasdaq, secured $154.7 million through a private investment in public equity (PIPE) financing, funded by 2,380 Bitcoin deposited directly into its company wallet.
- Director Botao Ma described this financing as a pivotal moment in Zhibao's ten-year journey.
- This unique all-crypto funding approach differentiates Zhibao from traditional models that typically involve cash transactions followed by Bitcoin purchases, joining an increasingly competitive market.
Zhibao Technology, a Chinese insurance-technology firm listed on Nasdaq, has officially entered the Bitcoin treasury space by finalizing a $154.7 million private placement funded entirely through cryptocurrency.
The company announced on Monday that a group of investors outside the U.S. contributed 2,380 Bitcoin directly to the company’s wallet rather than using cash. Each Bitcoin was valued at approximately $65,000, based on market prices as of July 30.
Myriad: Predict the next Bitcoin price movement. Join the prediction.In return, investors received 442 million units priced at $0.35 each, with each unit consisting of a Class A ordinary share and a two-year warrant. About 396 million units were issued at the closing, with the remaining units pending shareholder approval.
Zhibao, recognized as a pioneer in embedded digital insurance in China, emphasized that this financing is more of a breakthrough than a shift from its primary business focus. According to Director Botao Ma, this funding will fortify Zhibao's financial foundation and enable the expansion of its AI-driven insurance offerings. He noted that the investors possess significant expertise in the cryptocurrency sector, which he believes will create new avenues for the company.
This development places Zhibao alongside a growing list of public companies that are incorporating Bitcoin into their balance sheets, although its all-crypto funding model is distinct from the more common cash-raise-then-purchase strategy used by many treasury firms.
For instance, Japan's Metaplanet is establishing a U.S. treasury initiative with 2,100 BTC, valued at about $132 million. Conversely, Strategy, a leader in this approach, has ceased its weekly Bitcoin acquisitions and is now selling portions of its holdings to stabilize its financial situation. Recently, it raised $334 million by selling stock while keeping its Bitcoin untouched.
Investing in digital asset treasuries carries substantial risks as well as potential rewards. Companies that adopt this strategy are heavily reliant on a volatile asset, and signs of strain are appearing in the market. Strategy has transitioned to what it refers to as a capital-management framework, utilizing Bitcoin sales to fund dividends and stock buybacks, while some newer firms have begun to unwind their Bitcoin positions as market enthusiasm wanes.
Zhibao plans to submit a resale registration statement with the SEC within 45 days of the effective date of July 31, which will cover the shares and warrants issued during this deal.