Sharplink Gaming has taken a major step into the crypto space by establishing an Ethereum Treasury Reserve and acquiring over $462 million worth of ETH. This move makes the company the largest public holder of ETH, second only to the Ethereum Foundation.

According to a press release, Sharplink purchased 176,270.69 ETH at an average price of $2,626, totaling approximately $462.9 million. The acquisition reflects a major shift in the firm’s strategy, placing Ethereum at the center of its digital asset reserves.

Sharplink’s ETH Funding Strategy

To fund the purchase, Sharplink raised $425 million through a private placement deal and another $79 million via an at-the-market (ATM) equity offering. The company used most of these proceeds to acquire ETH, highlighting its strong commitment to building a substantial crypto reserve.

As a result, Sharplink reported an 11.9% increase in ETH per share since June 2. It has also deployed over 95% of its ETH into staking and liquid staking protocols, contributing to Ethereum’s network security while generating passive yield.

Stock Dips Despite Ethereum Bet

Despite Sharplink’s bullish ETH announcement, its stock (SBET) experienced sharp volatility. According to Google Finance, the stock dropped 12.25% on Thursday to close at $32.50, then plunged to as low as $8 in after-hours trading.

However, by Friday, it had recovered slightly to $11.05, still down about 66% over 24 hours. Nonetheless, the stock remains up nearly 230% over the past month and 37% year-to-date.

Meanwhile, the steep drop came after Sharplink filed an S-3 registration with the U.S. Securities and Exchange Commission. The filing outlined a possible resale of 58.7 million shares issued during a previous private investment in public equity (PIPE) offering, involving more than 100 investors.

In turn, this triggered fears of dilution, prompting a wave of selling. In response, Sharplink Chairman Joseph Lubin clarified on X that the filing doesn’t reflect any current sales. He explained that it only registers shares in case past investors choose to sell later.