With Convertible Note Retirement, BTCS Now Debt Free

Rhea-AI Summary

BTCS has announced the retirement of its $1 million convertible note, eliminating its debt and aligning shareholder interests with insiders holding 42% of the shares. This strategic move is expected to prevent dilution and enhance shareholder value. The company reported a significant increase in its digital asset holdings, growing from $4 million at the start of 2021 to $45.7 million by early November 2021. BTCS aims to leverage its debt-free status and strong financial position to exceed its projected revenue of $1.1 million for fiscal year 2021, with plans for growth in its blockchain infrastructure operations.

Positive

• Debt-free status achieved by paying off the convertible note, enhancing shareholder value and preventing dilution.
• Significant growth in digital asset holdings from $4 million to $45.7 million in 2021, reflecting strong investment performance.
• Stock price increased by 263% from $2.18 to $7.92 since the note issuance, indicating strong market confidence.
• Expectations to exceed 2021 revenue guidance of $1.1 million, signaling robust operational growth.

Negative

• None.

Silver Spring, MD, Nov. 15, 2021 (GLOBE NEWSWIRE) -- BTCS Inc. (Nasdaq: BTCS) (“BTCS” or the “Company”), a blockchain technology focused company, is pleased to announce that by paying off its last $1.0 million convertible note, issued in January 2021, the Company is now debt-free.

With BTCS insiders owning approximately 42% of the Company’s outstanding shares, there is a strong alignment of shareholder interests, and desire to minimize dilution and create value. “By eliminating our remaining outstanding debt and avoiding the potential dilution from the conversion of this note, we are driving further value for our shareholders,” stated Charles Allen, Chief Executive Officer of BTCS. “The note could have converted at a discount to the closing market price on the date of conversion.”

The retired note’s 12% cost of capital offered a favorable non-dilutive funding vehicle as evidenced by the +667% increase in the market value of the Company’s digital asset holdings from $4 million at the beginning of 2021 to $45.7 million as of November 4, 2021. The note helped drive this exponential increase, providing an exceptional return on investment and the fuel for our revenue generating blockchain infrastructure operations. From the January 15, 2021 issuance of the now retired note, BTCS’ stock price rose to $7.92 as of November 12, 2021 from $2.18 (adjusted for the August 2021 reverse stock split), representing a +263% increase.

With inflation set to run at its highest rate in 30 years, possibly exceeding a 7% annual rate in the coming months, the digital assets held by BTCS are now increasingly recognized as an effective hedge against inflation thus positioning the Company to offer shareholders the opportunity to create real (i.e. inflation-adjusted) economic value.

“Our September 2021 listing on Nasdaq has placed us in a position that we believe improves our access to debt financing and other lower cost of capital options to grow operations, drive revenue, and ultimately improve return on equity for our shareholders,” continued Allen. “Thanks to the growth of our high profit margin blockchain infrastructure operations, which in part were supported by this now retired note, we are on track to exceed our March 2021 guidance of $1.1 million in revenue for fiscal year 2021. The Company is now in the strongest financial position ever. Our plan is to capitalize on this strength with the strategic growth of our revenue generating blockchain infrastructure operations. Furthermore, we are evaluating other corporate options to reward and create value for our shareholders.”

About BTCS:

BTCS is an early mover in the blockchain and digital currency ecosystem, and the first "Pure Play" U.S. publicly traded company focused on blockchain infrastructure and technology. Through its blockchain infrastructure operations, the Company secures Proof-of-Stake blockchains by actively processing and validating blockchain transactions and is rewarded with native digital tokens. The Company is developing a proprietary Staking-as-a-Service platform to allow users to stake and delegate supported cryptocurrencies through a non-custodial platform, which it plans to integrate with its Data Analytics Dashboard, now in beta release. BTCS’s proprietary digital asset data analytics platform currently supports six exchanges and over 800 digital assets, and the Company plans to further broaden its suite of performance-tracking tools, add additional centralized and decentralized exchanges, as well as wallets, and stake pool monitoring. The Company’s digital asset treasury strategy, with a primary focus on disruptive non-security protocol layer assets, is a core component of its business model and supports BTCS’s expanding operations. For more information visit: www.btcs.com.

Forward-Looking Statements:

Certain statements in this press release, constitute “forward-looking statements” within the meaning of the federal securities laws including statements regarding our belief regarding our improved access to debt financing and other lower cost of capital options to grow operations, drive revenue, and ultimately improve return on equity for our shareholders, our belief regarding our revenue guidance, our intentions to continue to capitalize on our strong financial position and continue to grow our revenue generating operations. Words such as “may,” “might,” “will,” “should,” “believe,” “expect,” “anticipate,” “estimate,” “continue,” “predict,” “forecast,” “project,” “plan,” “intend” or similar expressions, or statements regarding intent, belief, or current expectations, are forward-looking statements. While the Company believes these forward-looking statements are reasonable, undue reliance should not be placed on any such forward-looking statements, which are based on information available to us on the date of this release. These forward-looking statements are based upon current estimates and assumptions and are subject to various risks and uncertainties, including without limitation the rewards and costs associated with validating transactions on proof-of-stake blockchains, significant decrease in value of our digital assets and rewards, loss or theft of the private withdrawal keys resulting in the complete loss of digital assets and reward, decrease in the value in the crypto that we currently own, as well as risks set forth in the Company’s filings with the Securities and Exchange Commission including its Form 10-K for the year ended December 31, 2020 and the Prospectus Supplement dated September 14, 2021. Thus, actual results could be materially different. The Company expressly disclaims any obligation to update or alter statements whether as a result of new information, future events or otherwise, except as required by law.

Investor Relations:
Dave Gentry
RedChip Companies, Inc.
Phone: (407) 491-4498
dave@redchip.com

FAQ

What does it mean for BTCS to be debt-free?

BTCS's debt-free status means it has eliminated its last remaining convertible note, preventing shareholder dilution and aligning interests with insiders.

What is the current market value of BTCS's digital asset holdings?

As of November 4, 2021, BTCS's digital asset holdings have increased to $45.7 million.

How much has BTCS's stock price increased since January 2021?

BTCS's stock price rose by 263%, from $2.18 to $7.92, since the issuance of the convertible note.

What is BTCS's revenue guidance for fiscal year 2021?

BTCS expects to exceed its revenue guidance of $1.1 million for fiscal year 2021.

How does BTCS plan to leverage its strong financial position?

BTCS plans to capitalize on its financial strength by expanding its revenue-generating blockchain infrastructure operations.