In a breakthrough in the cryptocurrency industry, Strive Asset Management has announced a merger with Asset Entities Inc., a Nasdaq-listed digital marketing company. The deal aims to create the first publicly traded Bitcoin treasury company, marking a revolutionary approach to corporate Bitcoin investment.
Strategic Merger and Capital Acquisition
The merger, which is being done as a reverse takeover, will have the combined company continue to operate under the Strive brand but with its Nasdaq listing. The main aim is to raise $1 billion in equity and debt offerings to purchase Bitcoin, thus establishing a large reserve. The move is intended to maximize exposure to Bitcoin per share and seeks to beat Bitcoin in the long term.
One of the distinct characteristics of this plan is the scheduled swap of equity for Bitcoin, which is offered to specific accredited investors. This swap is designed to be tax-free under Section 351 of the Internal Revenue Code so that investors can swap company stock for Bitcoin without the current tax consequences. This novel solution aims to bring crypto-native investors into the equity market.
The leadership of the new company will be headed by Matt Cole, a former fixed-income portfolio manager of $70 billion in assets. He will be joined by Ben Pham as CFO, Arshia Sarkhani as Chief Marketing Officer, and Logan Beirne as Chief Legal Officer. Strive Enterprises, founded by Vivek Ramaswamy, will have about 94.2% ownership of the public company, with legacy Asset Entities shareholders owning the remaining 5.8%.
Innovative Capital Raising Strategies and Market Positioning
Apart from conventional capital raising, the combined group intends to use various innovative methods for building up Bitcoin. These involve taking on overcapitalized businesses that are trading at a discount to net cash to obtain discounted capital, and using fixed income and derivatives expertise to release further funds to utilize for buying Bitcoin. All these approaches seek to establish a Bitcoin reserve in a way that is as least dilutive as possible to common shareholders.
In addition, Strive Asset Management has submitted to the U.S. Securities and Exchange Commission to list the Strive Bitcoin Bond ETF. The fund will invest in convertible bonds of companies such as MicroStrategy, which have used bond proceeds to buy Bitcoin. The ETF will also provide exposure through swaps and options, giving investors diversified channels to achieve Bitcoin exposure.
This combination and related strategy represent a pattern of increasing demand by institutional and corporate investors to include Bitcoin within their treasury planning. Through creating a publicly listed Bitcoin treasury entity, Strive hopes to lead the way to new standards of corporate Bitcoin investing, providing sophisticated solutions for digital asset-exposure-seeking investors.
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