SharpLink Gaming (SBET) announced Monday the successful completion of a $450 million capital raise intended to fund its new Ethereum (ETH) treasury strategy.
After last week’s incredible 2,000% surge, SharpLink shares slid 30% in early trading Monday, relinquishing some of the spectacular gains.
The stock skyrocketed from under $3 to a peak above $100 following the news of the massive fundraising and the appointment of Ethereum co-founder Joseph Lubin as chairman of SharpLink’s board.
SharpLink issued 69 million shares during the capital raise. However, as pharmaceutical entrepreneur Martin Shkreli pointed out, the majority of these shares remain restricted. “The 69 million shares are subject to a registration rights agreement that won’t take effect for months, meaning only 2 million shares are currently freely tradable,” he explained.
Shares sold in private placements usually come with resale restrictions until the company completes the regulatory registration process, which can take several months. This restriction reduces the public float and can lead to high price volatility.
SharpLink’s small public float has likely fueled the extreme price swings seen last week as traders rushed to buy into the limited supply.
With the capital raise now closed and new leadership joining the company, the stock has retreated modestly, signaling a natural cooldown after last week’s frenzy.
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