BTCS Crypto Fund Grows In 2021: Is It The Right Time To Invest?

BTCS Inc., the publicly traded digital asset and blockchain technology-focused company, recently revealed that its management had made investments worth $1.1 million in the company. Nonetheless, a bullish sign for BTCS investors as it reinforces the management’s confidence and trust in its business model and future growth prospects. 

The funding round was led by the company’s CEO, Charles Allen. According to sources, Allen personally invested $810,000.  “My interests are totally aligned with investors. I have made a considerable investment in the Company,” Allen said.

For those investors and cryptocurrency enthusiasts, who aren’t familiar with BTCS or its business model, well, according to its website BTCS is a publicly-traded company focusing on digital assets and blockchain technologies. 

BTCS is among the first few public companies to develop a business model that provided opportunities for investors owning Bitcoin, Ethereum, other cryptocurrencies. CEO Charles Allen is well-known in the crypto industry space, having spent the last seven years developing the platform.  During his tenure, the BTCS crypto fund grew 1,327% from December 31, 2019, to December 31, 2020.

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Speaking about the company’s progress, BTCS CEO Charles Allen, CEO of BTCS, said, “Our original thesis that has guided our operating decisions across the years has proven very prescient over the past 12 months. While we are pleased with the strong gains of 2020, management believes the best is ahead for BTCS and recently backed this belief by investing $1.1 million into the Company, representing a substantial financial commitment. We want to thank our shareholders for their continued support and look forward to sharing more of our successes with you in 2021 and beyond.”

According to BTCS, the company’s timely purchases of Bitcoin and Ethereum have been instrumental in growing its digital asset portfolio in the past 18 months. BTCS’s Fair Market Value of its crypto fund increased 1,327% to $3.9 million in the past 12 months ending on December 31, 2020.  

BTCS explained, “The Company believes Bitcoin, Ethereum, and certain other digital assets are a great store of value and can be an effective hedge against monetary debasement in the wake of multi-trillion-dollar economic bailouts. Bitcoin has rallied over 700% from its March 2020 low, which the Company believes is driven by institutional investors’ interest in digital assets, PayPal allowing its customers to buy and sell bitcoin through their platform, and a flight to safety during the ongoing COVID-19 pandemic and political turmoil. On January 8, 2021, the Company’s digital asset portfolio had a Fair Market Value of approximately $7 million, which includes $800,000 worth of digital assets purchased with the proceeds of management’s recent $1.1 million investment.”

BTCS Stock Continues Its Upward Rally As Bitcoin’s Value Surges Beyond $47,000

In the first weeks of January this year, the market value of BTCS has surged to 500%. The stock price rose from 0.20 cents to $1.34 in the first week of January 2021. BTCS market capitalization lingers to around $50 million, but it’s undervalued compared to its other publicly traded counterparts.  

You are probably aware that cryptocurrencies, especially Bitcoin, is trading at an all-time high, and the price of a Bitcoin has surpassed the $47,000 as of writing this article. Some of the major reasons for this incredible rise in Bitcoin price can be attributed to large institutional investors using the digital asset as a hedge against inflation. 

However, although Bitcoin reached its all-time high of over $57,000 on February 21, 2021, some analysts assume that Bitcoin’s price could reach to $400,000. The value of cryptocurrency stocks is directly correlated with the movement in cryptocurrency prices.

Farsighted and Timely Purchase Of Cryptocurrency Led To BTCS Crypto Fund Growth

The BTCS crypto fund growth strategy is bullish. The company’s crypto portfolio witnessed an increase of around $4 million to $7 million in January this year alone, up by 80%. The reason? The company management’s foresight of timely investments in Bitcoin (BTC) and Ethereum (ETH).

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BTCS crypto portfolio growth strategy is focused on three areas:

  1. Strategic purchases of cryptocurrencies and other digital assets will continue to increase the value of its crypto fund
  2. Making strategic acquisitions of innovative technologies in the cryptocurrency industry
  3. Developing a distinctive data analytics platform that would enable cryptocurrency ad digital assets investors to track their crypto portfolio for performance metrics and tax purposes.  

It had become apparent that many crypto funds struggled to recover when the market slumped in March 2020, but that didn’t deter BTCS growth. The company grew by 130% in the second quarter of 2020—thanks to the strategic investments in Bitcoin and Ethereum.

By the end of June 2020, the BTCS crypto fund’s total worth rose to $1.02 million with favorable positions in Bitcoin and Ethereum. However, the management decided not to add any further cryptocurrencies investments to its portfolio. 

The move made BTCS immune to the unexpected crash of cryptocurrency prices in mid-March despite the World Health Organization (WHO) declaring the COVID-19 coronavirus as a global pandemic on March 11. This lead panicked investors to selloffs of their crypto holdings for liquid cash after governments talked about the possibilities of lockdowns.

Undeterred by a looming market crisis and predictable lockdowns, BTCS held off from selling its crypto investment pool throughout the entire first quarter of 2020. Bitcoin declined to $3,800 within hours, and the entire crypto market capitalization contracted half to almost 50%. 

Throughout the 2nd Quarter 2020, BTCS added 33.7 Bitcoin and 1,319.6 Ethereum to its crypto fund. The company’s total crypto fund surged to 54.3 Bitcoin and 2,304.6 Ethereum. 

In mid-March, the Bitcoin price surged to around 150%, and the BTCS crypto fund gained from under $300,000 in the first quarter of 2020 to around $1.02 million by the end of the second quarter of 2020.

The BTCS management also undertook cost-cutting measures to fend off the financial ramifications of the pandemic, such as slashing its yearly independent director fee from $75,000 to $18,750 for 2020 and to $15,000 for 2021. Furthermore, the company approved to postpone 35% of its management’s salaries for the second quarter of 2020.

“The coronavirus pandemic has sent shockwaves through the global economy,” commented CEO Allen. “While digital assets tumbled with the initial selloff in equities in March, we believe this is an anomaly that could create an opportunity for us to accumulate digital assets at attractive prices. With a strengthened cash position & lowered burn, we are in an ideal position to increase exposure to digital assets at depressed values.”

Is It The Right Time To Invest In BTCS Crypto Fund In 2021?

It depends on the investor. CEO Charles Allen has reiterated that his interests are aligned with investors, given that he himself made a sizeable investment in the company. Moreover, he believes the cryptocurrency industry is still a long way in its infancy, but there are tremendous possibilities to gain for investors who are willing to invest in BTCS.

“I believe the cryptocurrency space is still in its infancy, and there is enormous upside for those who invest in Companies like BTCS. Moreover, at some point, we intend to uplist our stock to either the New York Stock Exchange or the NASDAQ stock exchange.  An uplisting to a national stock exchange will give us greater access to capital and further propel our growth opportunities,” Allen commented. 
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