Semler Scientific® Announces Bitcoin Treasury Strategy

Rhea-AI Summary

Semler Scientific (Nasdaq: SMLR) has adopted bitcoin as its primary treasury reserve asset, purchasing 581 bitcoins for $40 million. Chairman Eric Semler stated that bitcoin's scarcity and digital resilience make it a superior store of value and a potential hedge against inflation compared to gold. The SEC's approval of bitcoin exchange-traded funds and institutional investments validate this strategy. Despite the bitcoin focus, Semler will continue prioritizing its core medical products, particularly QuantaFlo® for peripheral arterial disease testing, while seeking FDA clearance for expanded labeling. Bitcoin holdings will be subject to market conditions and cash needs.

Positive

• Semler Scientific purchased 581 bitcoins for $40 million, demonstrating confidence in bitcoin as a store of value.
• Bitcoin’s digital and architectural resilience is seen as preferable to gold.
• The SEC has approved 11 bitcoin ETFs, showing increasing institutional acceptance of bitcoin.
• Semler Scientific continues to focus on core medical products, particularly QuantaFlo®.
• The company seeks new 510(k) clearance from the FDA for expanded labeling, potentially boosting product use.

Negative

• The decision to hold bitcoin as a primary treasury reserve asset introduces significant volatility risk.
• Heavy reliance on bitcoin's value may expose the company to market fluctuations.
• The $40 million investment in bitcoin is a substantial portion of the company’s treasury, which may concern risk-averse investors.

Financial Analyst

The decision by Semler Scientific to adopt bitcoin as its primary treasury reserve asset and the subsequent purchase of 581 bitcoins for $40 million is a bold and significant move. From a financial perspective, this is indicative of a strategic shift towards more dynamic asset management. Bitcoin, being a relatively volatile asset compared to traditional reserves like cash and bonds, could introduce higher risks into Semler's balance sheet. However, the potential for outsized returns could be beneficial if bitcoin continues its trend of appreciation.

It's noteworthy that Semler has chosen bitcoin over traditional and arguably more stable assets like gold. This could be seen as a bet on the increasing institutional acceptance of bitcoin, bolstered by the SEC's approval of 11 bitcoin exchange-traded funds earlier this year. With 10% of all bitcoins now reportedly held by institutions, this move aligns with a broader trend of bitcoin institutionalization. Yet, retail investors should weigh the high volatility of bitcoin against its potential for high returns. This decision implies a long-term optimistic view of bitcoin as a store of value and inflation hedge, but also opens the door to significant market risk.

Rating: 1

Market Research Analyst

From a market perspective, Semler Scientific's bitcoin investment is a reflection of a broader trend towards cryptocurrency adoption within the corporate sector. The company's move comes at a time when digital assets are gaining credibility, particularly with institutional investors. This decision could potentially enhance Semler's positioning as an innovative and forward-thinking company. However, it also introduces a layer of complexity in terms of market perception and investor sentiment.

The healthcare industry has traditionally been conservative with its treasury strategies, so this departure may signal a new phase of financial experimentation. For retail investors, this may be seen as a double-edged sword. On one hand, the potential for high returns is enticing; on the other hand, the unpredictable nature of bitcoin could impact the company's financial stability. Investors should monitor how this strategy impacts Semler's overall performance and whether it influences other companies within the sector to adopt similar strategies.

Rating: 1

Technology Analyst

Semler Scientific's decision to adopt bitcoin as a primary treasury reserve asset highlights the intersection of technology and finance. Bitcoin's blockchain technology offers intrinsic security and transparency benefits, which might appeal to companies looking for resilient financial instruments. The notion of bitcoin as 'digital gold' suggests a growing belief in its long-term value preservation, driven by its decentralized nature and capped supply.

For technology enthusiasts, this move may signify confidence in the technological underpinnings of bitcoin. The increasing institutional adoption and the approval of multiple bitcoin ETFs underscore a material shift in how digital assets are perceived. However, it is important to recognize that the technological robustness of bitcoin does not negate its market volatility. Retail investors should be aware that while blockchain technology is sound, the market dynamics of cryptocurrencies can be unpredictable.

Rating: 1

SANTA CLARA, Calif., May 28, 2024 /PRNewswire/ -- Semler Scientific, Inc. (Nasdaq: SMLR), a pioneer in developing and marketing technology products and services to healthcare providers to combat chronic diseases, announced today that its board of directors has adopted bitcoin as its primary treasury reserve asset. In addition, Semler Scientific announced that it has purchased 581 bitcoins for an aggregate amount of $40 million, inclusive of fees and expenses.

"Our bitcoin treasury strategy and purchase of bitcoin underscore our belief that bitcoin is a reliable store of value and a compelling investment," said Eric Semler, Semler Scientific's chairman. "Bitcoin is now a major asset class with more than $1 trillion of market value. We believe it has unique characteristics as a scarce and finite asset that can serve as a reasonable inflation hedge and safe haven amid global instability. We also believe its digital, architectural resilience makes it preferable to gold, which has a market value of approximately 10 times that of bitcoin. Given the gap in value between gold and bitcoin, we believe that bitcoin has the potential to generate outsize returns as it gains increasing acceptance as digital gold.

"Furthermore, we are energized by the growing global acceptance and 'institutionalization' of bitcoin -- reflected most recently by the Securities and Exchange Commission's January 2024 approval of 11 bitcoin exchange-traded funds. These funds have reported more than $13 billion of net inflows, with investments from nearly 1,000 institutions, including global banks, pensions, endowments and registered investment advisors. It is estimated that more than 10% of all bitcoins are now held by institutions," added Mr. Semler.

Semler Scientific's board and senior management have spent substantial time examining potential uses of cash, including acquisitions. "After studying various alternatives, we decided that holding bitcoin would be the best use of our excess cash," said Mr. Semler. 

In conjunction with its bitcoin treasury strategy, Semler Scientific will continue to focus on its core medical products and services. "We remain dedicated to our customers and our goal of operating a growing and profitable healthcare company," said Doug Murphy-Chutorian, MD, Semler Scientific's chief executive officer. "We are focused on maintaining sales of QuantaFlo® for peripheral arterial disease testing, while seeking a new 510(k) clearance from the FDA with expanded labeling for use as an aid in the diagnosis of other cardiovascular diseases." 

As Semler Scientific continues to generate revenue and free cash flow from sales of QuantaFlo, it will proactively evaluate its use of excess cash. Bitcoin will serve as Semler Scientific's principal treasury holding on an ongoing basis, subject to market conditions and the anticipated cash needs of Semler Scientific. 

More information regarding Semler Scientific's bitcoin treasury strategy will be posted on its website at www.semlerscientific.com. 

About Semler Scientific, Inc:

Semler Scientific, Inc. develops, manufactures and markets innovative products and services to combat chronic diseases. Its flagship product, QuantaFlo®, which is patented and cleared by the U.S. Food and Drug Administration (FDA), is a rapid point-of-care test that measures arterial blood flow in the extremities. The QuantaFlo test aids in the diagnosis of cardiovascular diseases, such as peripheral arterial disease (PAD), and Semler Scientific is seeking a new 510(k) clearance for expanded indications. QuantaFlo is used by healthcare providers to evaluate their patient's risk of mortality and major adverse cardiovascular events (MACE). Semler Scientific also invests in bitcoin and has adopted bitcoin as its primary treasury reserve asset. Additional information about Semler Scientific can be found at www.semlerscientific.com. 

Forward-Looking Statements

This press release contains "forward-looking" statements. Such statements can be identified by, among other things, the use of forward-looking language such as the words "believe," "goal," "may," "will," "intend," "expect," "anticipate," "estimate," "project," "would," "could" or words with similar meaning or the negatives of these terms or by the discussion of strategy or intentions. The forward-looking statements in this release include express or implied statements regarding the new bitcoin strategy and its ability to generate outsize returns, Website posting of information regarding the bitcoin strategy, as well as seeking a new 510(k) clearance for QuantaFlo with expanded indications for use, among others. Such forward-looking statements are subject to a number of risks and uncertainties that could cause Semler Scientific's actual results to differ materially from those discussed here, such as risks inherent with investing in bitcoin, including bitcoin's volatility; risk of implementing a new treasury strategy; risk that insurance plans and other customers will not continue to license its cardiovascular testing products; risk of changes in the reimbursement landscape for its customers including related to the CMS rate announcement; risk of obtaining a new 510(k) clearance for expanded indications; along with those other risk factors detailed in Semler Scientific's filings with the Securities and Exchange Commission. These forward-looking statements involve assumptions, estimates, and uncertainties that reflect current internal projections, expectations or beliefs. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. All forward-looking statements contained in this press release are qualified in their entirety by these cautionary statements and the risk factors described above. Furthermore, all such statements are made as of the date of this release and Semler Scientific assumes no obligation to update or revise these statements unless otherwise required by law.

INVESTOR CONTACT:

Renae Cormier
Chief Financial Officer
ir@semlerscientific.com 

 

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SOURCE Semler Scientific, Inc.

FAQ

What is Semler Scientific's new primary treasury reserve asset?

Semler Scientific's new primary treasury reserve asset is bitcoin.

How much did Semler Scientific invest in bitcoin?

Semler Scientific invested $40 million in bitcoin.

How many bitcoins did Semler Scientific purchase?

Semler Scientific purchased 581 bitcoins.

Why did Semler Scientific choose bitcoin as a reserve asset?

Semler Scientific believes bitcoin is a reliable store of value, a potential inflation hedge, and has unique characteristics as a scarce, finite asset.

What is the ticker symbol for Semler Scientific?

The ticker symbol for Semler Scientific is SMLR.

What core product does Semler Scientific focus on?

Semler Scientific focuses on QuantaFlo®, a product for peripheral arterial disease testing.

What recent SEC action supports Semler Scientific's bitcoin strategy?

The SEC's approval of 11 bitcoin exchange-traded funds supports Semler Scientific's bitcoin strategy.

What is Semler Scientific seeking from the FDA?

Semler Scientific is seeking new 510(k) clearance from the FDA for expanded labeling of QuantaFlo®.