SharpLink Gaming, Backed by Ethereum Treasury, Falls 70% — Yet a Twist Could Change the Story

SharpLink Gaming Shares Tumble 70% After SEC Filing Opens PIPE Shares for Sale — But a $1 Billion ETH Buy Could Be Coming

Shares of SharpLink Gaming (NASDAQ: SBET), a company building an Ethereum (ETH) treasury, plunged 70% in after-hours trading Thursday following a new Securities and Exchange Commission filing.

The firm submitted an S-3ASR registration statement permitting the resale of nearly 59 million shares related to its recent private investment in public equity (PIPE) round. This allows over 100 PIPE investors to sell their holdings, flooding the market and sparking a steep sell-off after the market closed.

Charles Allen, CEO of fellow crypto treasury company BTCS, commented on X and in an interview with CoinDesk that this share unlocking likely drove the sharp price decline.

Earlier this month, SharpLink secured $450 million in PIPE funding from prominent backers including ConsenSys, Galaxy Digital, and Pantera Capital. Ethereum co-founder and ConsenSys CEO Joseph Lubin also joined SharpLink’s board as chairman, strengthening the company’s crypto credentials.

Despite the stock slump, Allen speculated that SharpLink might be preparing a much larger ETH acquisition—up to $1 billion—via an at-the-market (ATM) offering announced in a May 30 SEC filing.

“If executed well, a surprise announcement of $1 billion in ETH purchases could ignite a strong rebound in the stock price,” he noted.

Meanwhile, Ethereum has fallen about 4.1% over the last day, trading near $2,650 as broader crypto markets face downward pressure alongside Bitcoin.