Early Backers of Cryptocurrency Startup Block.one in Line for Mega Payday
PayPal’s Peter Thiel and other early Block.one backers are in line to receive returns of more than 6,500 percent for their initial investments, Bloomberg reports.
The cryptocurrency startup is looking to buy back ten percent of its shares. Meanwhile, hedge fund billionaire, Mike Novogratz’s Galaxy Digital has already sold most of its stake in the company.
6,567 Percent Returns for Block.one Backers
Block.one is planning a ten percent private buyback of its shares, according to Bloomberg. Reports indicate that early investors like Peter Thiel and ex-Bitmain chief Jihan Wu could receive as much as 6,567 percent on their investments.
Thus, an initial equity stake of $1 million could earn an early investor a whopping sum of $66 million. Galaxy Digital has already liquidated most of its stake in the cryptocurrency startup.
Announced on May 21, 2019, the crypto merchant bank said that it earned $71.2 million from the sale of its shares in the company. This payout corresponds with a 123 percent return on investment (ROI).
An excerpt from the announcement reads:
“The acceptance of Block.one’s tender offer reflected a decision to rebalance the portfolio to maintain an appropriate level of diversification after the position increased due to its substantial outperformance relative to the remainder of the portfolio.”
Another of Block.one’s early backers, fintech investor Christian Angermayer, said that he had no intentions of liquidating his stake in Block.one. According to Angermayer, the company continues to exceed expectations, positioning itself as one of the more critical establishments in the emerging digital landscape.
Block.one Now Valued at $2.3 Billion
After completing its $4 billion record-setting initial coin offering (ICO), the company says it is worth $2.3 billion. Block.one has also attracted investments from prominent individuals and firms in the industry.
While the likes of Angermayer continue to talk up the company’s potential, critics say its operations are lacking in the required level of transparency. Block.one responded to these concerns in an email to its investors earlier in the year.
According to Bloomberg, Block.one reportedly has most of its holdings in U.S. government bonds. The company also owns more than 140,000 BTC.
The bear market of 2018 reportedly put a dent in the company’s bitcoin bag, but inside sources at the firm say BTC’s 2019 resurgence has seen a significant recovery in value.