The Nasdaq-listed firm liquidated roughly $45 million worth of Bitcoin at an average price of about $71,000 per coin, used $20 million of those proceeds to retire Bitcoin-collateralized debt, and redirected the remaining $25 million toward growth initiatives. The restructuring leaves Fold debt-free on its secured obligations.
“As we approach several product launches,” he added, “we believe Fold is entering one of the most important growth periods in the company's history."
Investors responded positively to the announcement, with shares in FLD jumping as high as $1.60 after the opening bell—a 162% spike over Tuesday’s closing price. As of this writing, shares are trading at $1.10, still a more than 80% increase on the day.
Even with the sizable rebound, however, FLD shares have fallen about 58% since the start of the year, and over 78% over the last 12 months.
Reeves said management views the Fold Bitcoin Credit Card as one of the most significant long-term growth opportunities within its ecosystem, and that the cleaner balance sheet positions the company to expand its cardholder base and pursue additional lending partnerships.
The debt elimination also immediately removes monthly cash interest payments, which Fold said should improve its cash flow profile throughout the year as new products come online.
Fold's first-quarter revenue came in at $5.6 million, a 21% decline from a year earlier, according to the company's most recent earnings report.
