Sequans shares drop 16% after selling 970 Bitcoin to cut debt
Shares of semiconductor company Sequans dropped over 16% after the company sold 30% of its Bitcoin holdings to reduce its convertible debt by half, describing the move as 'strategic asset reallocation.' Sequans CEO Georges Karam stated the sale aimed to unlock shareholder value amid current market conditions while maintaining confidence in Bitcoin as a long-term reserve asset. The company's Bitcoin stash reduced from 3,234 BTC to 2,264 BTC, deviating from its earlier goal of accumulating 100,000 BTC in five years. Proceeds were used to cut debt from $189M to $94.5M. Investors reacted negatively, with Sequans' stock falling to $5.92, 89% below its 2025 high. The case highlights broader skepticism about the sustainability of Bitcoin treasury strategies for financially weaker firms. Analysts identified this Bitcoin sale as one of the most notable among public companies, making Sequans the 33rd largest corporate Bitcoin holder.
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Sequans' Strategic Bitcoin Sale
Shares in Sequans dropped by over 16% after the company sold 30% of its Bitcoin holdings to redeem half of its convertible debt. This decision was described by the semiconductor company as a “strategic asset reallocation.” CEO Georges Karam emphasized, “Our Bitcoin treasury strategy and our deep conviction in Bitcoin remain unchanged. This transaction was a tactical decision aimed at unlocking shareholder value given current market conditions.”
Impact of the Bitcoin Sale on Holdings and Debt
The sale reduced Sequans' Bitcoin holdings from 3,234 BTC to 2,264 BTC, deviating from its goal to accumulate 100,000 BTC over the next five years. The proceeds from the sale were used to halve its outstanding debt from $189 million to $94.5 million. Karam added, “It strengthens our financial foundation and removes certain debt covenant constraints, enabling us to pursue a wider set of strategic initiatives to prudently develop and grow our treasury, with Bitcoin as a long-term strategic reserve asset.”
Market Reaction to Sequans' Decision
The market showed a negative reaction to Sequans’ actions, with shares falling 16.6% to $5.92 on Tuesday, marking a significant decline. The stock is now 89% down compared to its 2025 peak of $53.90, which had been reached shortly after the company disclosed its Bitcoin plans in late June.
Broader Context of Bitcoin Adoption by Companies
Over 200 publicly traded companies now hold Bitcoin on their balance sheets, reflecting a growing trend of institutional Bitcoin adoption. This trend gained momentum after the launch of spot Bitcoin exchange-traded funds in the US last year. While some companies initially saw stock price rallies upon adopting Bitcoin treasury strategies, many have since experienced sharp declines as the initial excitement faded.
Doubts About Bitcoin Treasury Strategies
Declines in the stock prices of firms employing Bitcoin treasury strategies have led analysts to question their sustainability. Firms that are not in strong financial positions, like Sequans, are particularly vulnerable to these challenges. Analysts had already highlighted Sequans’ Bitcoin transfer last week, pointing out a notable 2,264 BTC transaction on Oct. 29.
Sequans' Position Among Bitcoin-Holding Companies
Following its Bitcoin sale, Sequans has become the 33rd largest corporate Bitcoin holder, dropping four spots since it initially acquired Bitcoin in mid-July. This makes Sequans' moves particularly noteworthy among publicly traded companies managing Bitcoin treasuries.