Ethereum co-founder enters the game, turning 400 million into 2.5 billion overnight: Is an ETH version of MicroStrategy emerging?

Jessy, Golden Finance

On May 27, sports betting operator SharpLink Gaming (NASDAQ: SBET) announced that it has secured $425 million in private investment, and the funds raised will be used to purchase Ethereum as the company's primary treasury reserve asset.

The lead investor in this private placement is Consensys Software Inc., with participants including ParaFi Capital, Electric Capital, Pantera Capital, and Galaxy Digital. The transaction is expected to be completed on May 29, and after the transaction is completed, Ethereum co-founder and Consensys founder and CEO Joseph Lubin will serve as the chairman of the SharpLink board and will assist the company in developing its core business as a strategic advisor.

After the announcement, SharpLink's stock price rose over 650% in a single day, with a cumulative increase of 17.56 times over three days. Currently, its stock has a circulating market value of 25 million USD, while the raised amount is 425 million USD, and the current book value has reached 2.5 billion USD.

Companies reserve crypto assets as treasury reserves, originally focusing on Bitcoin. SharpLink Gaming's move marks the first time a publicly traded company in the U.S. has made Ethereum its core reserve asset. Will SharpLink Gaming spark a wave of Ethereum reserve competition among publicly traded companies?

Bookmaker SharpLink Gaming, which has been losing money year after year

SharpLink Gaming is an online technology company operating in the fields of sports betting and online casino games, founded on December 27, 1995, and headquartered in Minneapolis, Minnesota, USA.

The company's specific business is to connect sports fans with licensed online sports betting operators through proprietary intelligent online conversion technology, providing personalized betting offers for sports fans. The company also operates an affiliate marketing website, offering high-quality traffic and player acquisition, retention, and conversion services for sports betting and online casino operators worldwide. In addition, SharpLink specializes in helping sports media companies develop strategies, products, and innovative solutions to drive deep customer engagement through highly interactive sports games and mobile applications.

The company's operating conditions are not ideal, with total revenue of $4.95 million and a net profit of -$14.24 million in 2023, and total revenue of $3.66 million with a net profit of -$4.57 million in 2024.

The overall operating condition of the company is not good. Firstly, the operating costs are relatively high. According to the financial report for the third quarter of 2024, the cost-to-revenue ratio is high, reaching 80.4%, mainly due to increased casino expenditures. At the same time, the company's operations also involve various expenses such as personnel salaries, technical maintenance, and marketing.

Similarly, the Q3 2024 financial report shows that the company's revenue declined mainly due to weak market conditions and customer attrition. The competition in the gaming industry is fierce, and any misstep could result in being squeezed by competitors.

Enterprise ETH Reserve Trend

SharpLink Gaming is not the first company to reserve Ethereum, but it is the first publicly listed company in the U.S. to raise significant funds through the sale of private equity to build an Ethereum treasury.

During the previous cycle, Ethereum was the second most popular cryptocurrency asset held by major companies. In this cycle, led by MicroStrategy, a wave of Bitcoin reserve enthusiasm has emerged among public companies, but there are still some companies that quietly hold Ethereum. Here are some publicly listed companies that hold Ethereum:

Boyaa Interactive: A Hong Kong listed company, as of November 12, 2024, holds 15,445 ETH. However, by the end of 2024, it replaced Ethereum with Bitcoin.

BTCS: As of May, the total holdings of Ethereum by the publicly listed company in the US stock market is approximately 12,500 coins. In May 2025, it announced an agreement with ATW Partners to raise funds through the issuance of convertible notes, with a total financing amount of up to $57.8 million. It is reported that all the funds raised will be used to purchase Ethereum in order to expand its validation node operation scale on the Ethereum network.

Blue Harbor Interactive: A Hong Kong-listed company, in its mid-year performance report for 2024, disclosed that it holds 848.386 Ethereum.

Remixpoint: A publicly listed company in Japan, as of May 27, 2025, the company holds multiple mainstream crypto assets including Ethereum.

Intchains Group: A Nasdaq-listed altcoin mining product development company, holding approximately 7023 ETH as of March 31, 2025.

Not just to create Polymarket on Ethereum

For SharpLink Gaming, the announcement of acquiring Ethereum has the most direct effect of turning its company stock into a crypto concept stock. After the news was released, SharpLink's stock price surged more than 650% in a single day, with a cumulative increase of 17.56 times over three days.

This company, which has been losing money for years, seems to be on the verge of a major turnaround by embracing cryptocurrency.

The recent purchase of Ethereum also seems to signal a long-term transformation and development path for the company. It is reported that Consensys, as the main investor, will provide SharpLink with technical and resource support from the Ethereum ecosystem, exploring innovative scenarios such as on-chain gambling and smart contract integration. SharpLink CEO Rob Phythian stated that this move aims to "deeply bind the company's balance sheet to the growth of the crypto economy" and promote the transition of traditional gambling business to Web3.

However, the direction that SharpLink wants to transform into is not just to become a polymarket on the Ethereum chain. Rather, it aims to be the Ethereum version of MicroStrategy.

The significance of SharpLink's large-scale purchase of Ethereum holds certain symbolic meaning for the crypto industry, suggesting that corporate treasury assets are expanding from a single Bitcoin to a diversified range of crypto assets. ETH, with its smart contract and staking capabilities, is likely to gain more favor.

A more realistic point is that this private equity financing is led by Consensys, which is highly associated with Ethereum. Joseph Lubin, co-founder of Ethereum and founder and CEO of Consensys, will also serve as the chairman of the board of SharpLink. The entry of Ethereum stakeholders into a traditional company and their vigorous promotion of an Ethereum strategic reserve at the corporate level seems aimed at establishing a benchmark and example globally, encouraging major companies to emulate and adopt Ethereum as a treasury reserve. This will continuously enhance the acceptance of Ethereum by traditional finance. Overall, Ethereum will ultimately be the final beneficiary.