DigiAsia Shares Surge 91% on $100 Million Bitcoin Reserve Plan

DigiAsia Corp, an Indonesian fintech company, announced on May 19 its intention to raise up to $100 million to establish a Bitcoin treasury reserve. The company's board of directors approved the creation of this reserve, with a commitment to allocate up to 50% of its net profits towards the acquisition of Bitcoin. DigiAsia aims to generate yield on its Bitcoin holdings through strategies such as lending and staking, and has already begun discussions with regulated partners to explore these opportunities. Additionally, the company is considering the issuance of convertible notes or crypto finance instruments linked to its planned Bitcoin holdings.

Following the announcement, DigiAsia's shares experienced a significant surge, closing the trading day with a gain of over 91% at 36 cents per share. However, post-market trading saw a 22% drop to 28 cents per share. Despite this volatility, the company's shares have shown resilience, with a year-to-date decline of nearly 53% from their peak in March 2024.

DigiAsia's financial update on April 1 revealed a 36% year-on-year revenue growth to $101 million in 2024. The company projects further growth, anticipating revenues to reach $125 million in 2025, along with earnings before interest and taxes of $12 million. This financial performance underscores DigiAsia's strong position in the market and its potential to leverage Bitcoin as a strategic asset.

The move by DigiAsia to incorporate Bitcoin into its treasury reserve aligns with a growing trend among companies to adopt Bitcoin as part of their corporate holdings. This strategy, popularized by Michael Saylor’s MicroStrategy, has seen a number of firms follow suit, including Strive Asset Management and GameStop Corporation. These companies have recognized the potential of Bitcoin to enhance their financial strategies and drive long-term value.

DigiAsia's decision to explore yield strategies and manage its Bitcoin holdings through regulated partners demonstrates a commitment to responsible and strategic investment. By committing a significant portion of its profits to Bitcoin acquisition and exploring innovative yield-generating methods, DigiAsia positions itself at the forefront of the evolving financial landscape. This move not only reflects the company's confidence in the future of Bitcoin but also its proactive approach to capitalizing on emerging opportunities in the digital asset space.