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A new strategy in the crypto market, known as the "shell game," involves a group of investors taking over small public companies in danger of being delisted. They then announce plans to buy crypto, driving up the stock price. This has led to several successful deals, with companies like Upexi and VivoPower seeing significant gains. The strategy aims to replicate the success of Michael Saylor's Strategy, which has amassed $60 billion in Bitcoin since 2020.

The crypto market has witnessed a novel strategy, dubbed the "shell game," where investors take over small public companies on the verge of delisting and announce plans to buy cryptocurrencies, particularly Ethereum (ETH), to drive up the stock price. This strategy has been successful in several deals, with companies like Upexi and VivoPower experiencing significant gains. The objective is to replicate the success of Michael Saylor's Strategy, which has amassed $60 billion in Bitcoin since 2020 [2].

SharpLink Gaming, a small U.S. stock company, exemplifies this strategy. Previously little-known and facing potential delisting, SharpLink announced on May 27 that it had secured approximately $425 million in private placement financing. The funds will be used to purchase a large amount of ETH as its main treasury reserve asset [1]. This move sparked heated discussions in the community, with some calling it the "Ethereum version of Strategy."

The financing round was led by Ethereum infrastructure developer ConsenSys, with participation from several prominent institutions such as ParaFi Capital, Electric Capital, Pantera Capital, Galaxy Digital, Ondo, GSR, and Republic Digital. SharpLink CEO Rob Phythian and CFO Robert DeLucia also participated in the subscription. The company plans to use the proceeds to purchase ETH and for daily operations and other general corporate purposes [1].

The addition of Joseph Lubin, co-founder of Ethereum and CEO of ConsenSys, as chairman of the board of directors is a significant development. Lubin's involvement is seen as an endorsement of identity and a strategic binding, aligning with ConsenSys' role in the Ethereum ecosystem [1].

SharpLink's stock price soared to $50 on the day of the announcement, reaching a record high since May 2023. The company's current valuation has jumped to $2.5 billion, a stark contrast to its previous marginal status with a daily trading volume of only tens of thousands of dollars and a stock price hovering around a few dollars [1].

The transformation of SharpLink is a result of careful business and identity reconstruction. The company, headquartered in Minneapolis, Minnesota, focuses on providing performance-driven marketing solutions for the sports betting and iGaming industries. However, it faced declining revenue and deteriorating finances for several years. Last year, it turned its net income from loss to profit, but the financial structure remains under pressure [1].

The "shell game" strategy aims to replicate the success of Michael Saylor's Strategy, which has amassed $60 billion in Bitcoin since 2020. By leveraging the capital market's imagination of Ethereum, this strategy seeks to create a similar capital miracle. However, it remains to be seen whether SharpLink's reliance on ETH reserves can withstand market cycles and replicate the success of Strategy-style capital leverage [1].

References:
[1] https://www.mexc.co/tr-CT/news/1931
[2] https://coinpedia.org/news/michael-saylor-targets-10-trillion-valuation-for-strategy-with-bold-bitcoin-bet/