Fold Sells ~$45M Of Bitcoin At ~$71K Apiece To Eliminate $20M Of Debt And Retain $25M Of Unrestricted Cash
Fold Holdings, Inc. (NASDAQ:FLD) ("Fold" or the "Company"), a bitcoin financial services company making it easy for individuals to earn, save and spend bitcoin through everyday financial tools, announced a series of capital transactions to strengthen the company's balance sheet, eliminate secured debt obligations, improve cashflows, and position Fold to materially scale its consumer and enterprise platforms.
Fold monetized approximately $45 million of bitcoin at an average price of approximately $71,000 per bitcoin, repaid $20 million of bitcoin-collateralized debt, and allocated the remaining $25 million of unrestricted cash towards growth initiatives across the business.
As a result of these transactions, Fold:
Eliminated all secured debt
Strengthened liquidity
Maintained a meaningful bitcoin treasury position
Improved monthly net cash flows
Increased its capacity to support future growth initiatives and financing partnerships
"We believe Fold is poised for near-term growth and investing in that future is exactly what the company needs to do," said Will Reeves, Chairman and Chief Executive Officer of Fold. "Over the past year, we've built one of the strongest product roadmaps in our history. In addition to our recently launched Credit Card, Bitcoin Gift Card, and Fold Business products, we plan to introduce new products over the coming months that we believe will expand the market for our business. Increased liquidity and lower debt ensure we have the resources and flexibility to execute our plans during this pivotal moment for Fold."
The strengthened balance sheet is also expected to accelerate the growth of the Fold Bitcoin Credit Card. Increased liquidity and financing flexibility position Fold to support a larger cardholder base, pursue additional funding relationships, and participate more meaningfully in the economics generated by the program as it scales. Management believes the Credit Card represents one of the most significant long-term growth opportunities within the Fold ecosystem.
In addition, these actions help Fold improve cash flows by immediately eliminating monthly cash interest payments. Management believes the company's cash flow profile can continue improving throughout the year as new products launch, customer activity increases, financing partnerships come online, and operating leverage improves across the platform.
Fold continues to maintain a meaningful bitcoin treasury position following the transaction while retaining the flexibility to monetize additional holdings when doing so represents the highest-return investment for shareholders. The company's revolving credit facility also remains available to support future growth initiatives.
"This decision reflects our conviction in Fold," Reeves continued. "We have reduced financing risk, strengthened our balance sheet, and ensured that short-term market volatility cannot stand in the way of executing our roadmap. As we approach several product launches, we believe Fold is entering one of the most important growth periods in the company's history."