Key facts
- Zhibao Technology completed a $154.7 million private placement funded by 2,380 Bitcoin.
- The Bitcoin was valued at $65,000 per coin.
- Investors received shares and warrants in exchange for their Bitcoin.
- The company plans to use the move to expand its AI-driven insurance products.
Zhibao Technology, a Nasdaq-listed Chinese insurance-technology firm, has completed a $154.7 million private placement financed entirely through cryptocurrency. The company announced Monday that a group of non-U.S. investors paid for the raise by contributing 2,380 Bitcoin directly to a corporate wallet, rather than using cash. The digital assets were valued at a reference price of $65,000 each, aligning with market levels on July 30.
In return for the Bitcoin, the investors received 442 million units, with each unit comprising a Class A ordinary share and a two-year warrant. The units were priced at $0.35 each. Approximately 396 million units were delivered at the closing of the transaction, with the remaining units to be issued following shareholder approval.
Zhibao, which positions itself as a leader in embedded digital insurance in China, described the transaction as a pivotal moment that strengthens its financial foundation and supports its expansion plans for AI-driven insurance products. Director Botao Ma highlighted that the investors possess significant expertise in crypto markets and infrastructure, which is expected to create new avenues for the firm.
This move places Zhibao among a growing number of public companies that are adding Bitcoin to their balance sheets. However, its funding structure, which is entirely in crypto, distinguishes it from the more common approach of raising cash and then purchasing Bitcoin. Japan's Metaplanet is establishing a U.S. treasury vehicle with 2,100 BTC, while Strategy, an early adopter of this strategy, has paused its weekly Bitcoin acquisitions and begun selling portions of its holdings to stabilize its financial situation. Strategy recently raised $334 million through a stock sale without liquidating its Bitcoin reserves.
The strategy of holding digital assets in corporate treasuries carries inherent risks due to the volatility of Bitcoin. Some companies, like Strategy, have shifted to a capital-management framework, using Bitcoin sales to fund dividends and buybacks. Other recent entrants have started to divest their positions as market conditions change.