BTC Digital Shares Plunge Following Common Stock Offering

The stock price of BTC Digital Ltd. (NASDAQ:BTCT), a company specialized in blockchain technology, dropped by 39% on Friday morning, falling to $9.90. This decline occurred after the announcement of a public offering of common stock priced at $8.00, significantly lower than the company's closing price of $15.66 on Thursday.

The company outlined the details of its underwritten public offering aimed at raising approximately $20 million before deducting underwriting fees and other related expenses. The offering includes 2,500,000 Common Shares and Pre-funded Warrants. Each Pre-funded Warrant is priced at $7,999, which is just below one dollar less than the common stock price, indicating that the warrants are nearly immediately exercisable.

Additionally, BTC Digital Ltd. granted Aegis Capital Corp., the sole book-running manager of the offering, an option to purchase up to 15% of the common shares sold to cover any over-allotments, if necessary. This option will be valid for 45 days.

The transaction is expected to close around December 9, 2024, subject to customary closing conditions. BTC Digital Ltd. plans to use the net proceeds from the offering for general corporate purposes and to support its working capital.

The pricing of the offering has evidently influenced investor sentiment, as seen in the sharp decline in the stock price. While Aegis Capital Corp. manages the offering process, VCL Law LLP and Kaufman & Canoles, P.C. are providing legal counsel to BTC Digital Ltd. and Aegis Capital Corp., respectively.