Baosheng Media Group Holdings Limited (BAOS) stock prices were up to USD$5.62 after a marginal uptrend of 0.09% as of market close on April 19th, 2021. Subsequent pre-market fluctuations brought the share price back down to USD$5.61, a dip of 0.18%.
Foray into Cryptocurrency
The Chinese online market solution provider announced on April 20th that Mr. Gang Chen had been appointed as project lead of their cryptocurrency-associated business. Mr. Chen has been charged with the task of assembling a team to facilitate BAOS’s marketing activities revolving around blockchain technology.
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With BAOS CEO indicating their gradual and cautiously optimistic approach to devoting resources to cryptocurrency related endeavors, such as the mining of Bitcoin, the company hopes Mr. Chen will provide the direction to accelerate the business. On April 14th, 2021, BAOS entered a purchasing contract that would see the company garner up to 1,000 mining machines for the mining of Bitcoin.
Capital Generation Via Purchase Agreement
On March 18th, 2021, BAOS entered into a securities purchase agreement that will see the company net USD$10 million in the capital. As per the agreement, BAOS will issue a total of 1,9760,784 units to investors, with each unit comprised of one share of common stock and a warrant to purchase one half of one share at an exercise price of USD$5.61. The shares themselves will be priced at USD$0.0005 per share of BAOS’s common stock.
Facilitating Crypto-Related Business
The funds generated are anticipated to be allocated towards the facilitation of marketing activities based on blockchain technology, as well as general business associated with cryptocurrency. With Ebang International being one of the investors that BAOS entered the Securities Purchase Agreement with, the cryptocurrency prospects of the company look promising.
Capital Generation Via IPO
Earlier in February, BAOS had announced an Initial Public Offering, wherein it put up 6 million shares of its ordinary shares on the Nasdaq Capital Market. Each share were priced at USD$5.00 per ordinary share, with aggregate gross proceeds expected to net BAOS USD$30 million before the deduction of offering-related expenses. Underwriters have also been granted a 45-day option to acquire up to an additional 900,00 ordinary shares in the case of over-allotment.
Allocation of Capital
BAOS anticipates using the capital generated from this offering for the expansion of their business scale, as well as securing authorized agent rights to additional media. BAOS hopes to build its own network of key opinion leaders and expand its manpower and talent pool. The funds will also be allocated towards general working capital purposes.
Future Outlook for BAOS
With the extent of generation of capital that BAOS has seen and its concrete moves to expand its footprint into the cryptocurrency and blockchain sectors, investors are hopeful that BAOS is primed to accelerate its growth and increase shareholder value.