Crypto-focused investment provider DeFi Technologies announced its purchase of 110 BTC for its corporate reserves on Friday, resulting in a predictable surge in the company’s stock price.
In a press release on Monday, the Canadian firm stated that Bitcoin would become its "primary treasury reserve asset," making it the first Canadian public company to adopt this strategy among a growing number of global firms.
"Bitcoin has emerged as a major asset class with a market value surpassing $1 trillion," the company stated. "DeFi Technologies acknowledges Bitcoin's unique qualities as a scarce and finite asset, offering a reliable hedge against inflation and a safe haven from monetary debasement."
Following the announcement, DeFi Technologies' stock, trading on Cboe Canada under the DEFI ticker, soared 25% to CAD $220 by Monday’s close, with a market cap of $641 million.
According to its website, DeFi Technologies offers "institutional-grade exposure to digital assets through ETPs, strategic ventures, and critical Web3 infrastructure." Its subsidiary, Valour, an ETF provider, manages CAD $837 million (USD $607 million) in assets.
The company offers a variety of crypto ETPs, including a Bitcoin ETF with zero fees and another offering over 5% annual yield to investors.
"Given the significant value gap between Bitcoin and traditional assets, DeFi Technologies believes Bitcoin can generate substantial returns as its acceptance grows," the company added.
DeFi Technologies also owns Reflexivity Research, a crypto market intelligence firm founded by crypto influencers Anthony Pompliano and Will Clemente. In a Monday tweet, Pompliano confirmed that his company, Pomp Investments, is an investor in DeFi Technologies and considers the firm undervalued.
In recent months, several companies besides the well-known MicroStrategy have adopted Bitcoin as their primary savings vehicle for excess cash, including US healthcare firm Semler Scientific and Japanese investment firm MetaPlanet.
MetaPlanet and Semler have shown a willingness to use capital markets to raise funds for additional BTC purchases, rather than relying solely on corporate profits. So far, DeFi Technologies has no plans to follow this approach.
MicroStrategy remains the largest corporate Bitcoin investor, managing 214,400 BTC.
