Nasdaq-listed healthcare services company KindlyMD has filed with the U.S. Securities and Exchange Commission (SEC) for automatic "shelf registration" for the distribution of up to $5 billion in stock. The company's move follows its recent purchase of $679 million in Bitcoin (BTC) through its subsidiary, Nakamoto Holdings.
In its filing, KindlyMD emphasized its commitment to Bitcoin as a long-term treasury reserve asset. The company stated, "We view Bitcoin as our primary treasury reserve and are committed to our long-term BTC accumulation strategy."
Shelf registration is a process that gives companies the flexibility to sell stock for a specific period. This allows KindlyMD to finance its growth plans by providing easier access to the capital markets. The filing states that not only common stock but also various financial instruments can be distributed. The distribution process is carried out in the U.S. by institutions such as Cantor Fitzgerald, TD Securities, and B. Riley Securities. On the Canadian side, the transaction will be made through intermediary institutions such as Canaccord Genuity.
The company's "Well-Known Seasoned Issuer" (WKSI) status is also a noteworthy detail. While this designation allows the company to act more quickly and flexibly in high-volume share issuances, it also carries greater risks against market volatility.
A new player in the Bitcoin treasury trend
KindlyMD's Bitcoin strategy began after its merger with Nakamoto Holdings. The company initially purchased 5,744 BTC, joining the trend of adding cryptocurrency to corporate balance sheets. Previously, MicroStrategy's massive BTC purchases under the banner "Strategy" inspired many corporate companies.
Today, not only KindlyMD but also companies like France-based semiconductor manufacturer Sequans Communications are taking similar steps. Sequans recently filed for a stock sale of up to $200 million and announced that the majority of the proceeds will be directed towards Bitcoin acquisitions. Analysts say such Bitcoin-focused treasury strategies could lead to a new equilibrium in the crypto market. Jay Jo, senior analyst at Tiger Research, notes that KindlyMD's move provides an advantage in raising capital, but risks also increase during periods of high volatility.
Spartan Group co-founder Kelvin Koh commented, "Institutional crypto investments have accelerated with the approval of Bitcoin ETFs in the US. This has normalized Bitcoin on balance sheets. However, this trend could lead to a withdrawal of liquidity from the altcoin market."
KindlyMD's shares fell 12% to $8.07 on the Nasdaq in the last trading day, while the price of Bitcoin rose 1% to $111,093.
