Volcon, Inc. announced a major move into digital assets by holding over 3,183 Bitcoin as of July 25. The purchase cost the company around $375 million, averaging nearly $117,700 per Bitcoin. Volcon also took a strategic step by selling short-term put options.
These allow the corporation to buy more Bitcoin at preset lower costs, $115,000, $116,000, and $117,000, with premiums earned to lower its purchase price in aggregate. This is a new direction towards treasury management from Volcon’s side. Bitcoin is what the corporation would want to use as a long-term store of value.
Bitcoin focus guides Volcon’s share buyback
It hopes to deploy the tools and methods its team developed as hedge fund managers to buy more Bitcoin at lower effective prices. It aims to offer shareholders exposure to Bitcoin without dilution or excessive costs. In addition to the Bitcoin update, Volcon expanded its stock repurchase program.
The board approved a buyback plan of a maximum of $100 million of shares over a period of 24 months. That gives flexibility to the corporation to offer support for its net asset value per share as well as obtain further Bitcoin exposure should share prices decline below NAV. Open market transactions, private sales, or any other legitimate methods can be utilized to buy shares.
Volcon will fund its purchases using available cash on hand. Repurchases will be decided upon by our management after evaluating a variety of considerations, including stock price and general market conditions. Our board will reassess this program from time to time and change or terminate it as necessary.
Volcon bets on Bitcoin for long-term growth
Recently, Volcon officially took on a Bitcoin-centric treasury strategy on July 17. It aspires to be a cheap and reliable accumulator of Bitcoin in the general markets. Volcon initially operated as an all-electric powersports company. It was a specialist in clean, quiet, and sustainable outdoor vehicles.
The new approach shows the direction of the company towards further finance and asset-based models, with its root remaining in innovation. Volcon’s new direction injects risk, especially with the volatility of digital assets like Bitcoin.
The business value can go hand in hand with crypto values. However, leadership believes this direction has long-term strength. Volcon will continue making adjustments to its approach as it maps its next direction of action.
