Bitcoin Treasury Firm ProCap Adds $31 Million in BTC as Stock Buybacks Grow

In brief

• Anthony Pompliano’s Bitcoin treasury firm added $31 million in BTC.
• The firm also continued its streak of buying back shares of BRR, now having added more than $2.2 million over 10 days.
• ProCap Financial stock is now changing hands around $2.83, up more than 7% on the day.

ProCap Financial, the Bitcoin treasury firm of crypto personality and investor Anthony Pompliano, said Monday that it acquired 450 BTC valued around $31 million amid continued share buybacks as the firm attempts to claw back towards a market cap on par with the value of its assets.  In addition to its Bitcoin purchase, which brings the firm’s total holdings to 5,457 or around $376 million, ProCap bought back more shares of its common stock (BRR), bringing its 10-day total to 782,408 shares, or about $2.2 million worth as BRR changes hands around $2.83.  “We are doing two things at the same time: buying Bitcoin to average down our total cost basis and buying back our own stock when the market misprices it,” said ProCap Chairman and CEO Anthony Pompliano, in a statement.  

“Both actions are accretive to our shareholders,” he added. “Our disciplined approach to our balance sheet has put us in a position to play offense now that Bitcoin has significantly fallen from the all-time high.” While the top crypto asset has fallen 45% from its October all-time high of $126,080, shares in BRR have fallen more than 72% in the last six months. The drop has helped drag down the firm’s mNAV—a ratio of its market cap to the net value of its underlying assets, like Bitcoin.  Digital asset treasuries that trade below their net asset value have often used share buyback programs in attempts to benefit shareholders and drive the mNAV back towards 1. According to the firm, its early share purchases have begun to shrink the discount between its market cap and NAV, noting that in the last 10 days, “the NAV discount has narrowed.” Furthermore, “the company intends to continue repurchasing shares for as long as BRR trades at a significant discount to NAV,” it added.

In data shared last week, ProCap indicated that its NAV—calculated as the sum of its Bitcoin and cash, less convertible debts—was around $305 million, while its shares traded for about 65% less. New estimates indicate that discount could have shrunk at least a few percentage points to around an mNAV of 0.68, based on its current intraday market cap of $239 million and updated estimated NAV of around $351 million thanks to Bitcoin’s rise.  Shares of BRR are up 7.5% on Monday and nearly 24% in the last month. However, they remain 82% off their 52-week high, according to data from Yahoo Finance. A representative for the firm did not immediately respond to _Decrypt’s _request for comment.