BTCS Inc (OTCMKTS:BTCS) is a simple way for OTC traders to get a cheap piece of the Bitcoin juggernaut. However, the stock hasn’t kept pace with the space all that well, bouncing back and forth in a sideways trading range for most of this year, while Bitcoin has exploded higher by as much as 400% in the past 7 months. So, we thought it was a good time to take stock of this relationship and get a sense of whether or not shares of BTCS might be ready to play a little catch-up before long.
In terms of recent action, we’ve witnessed 35% during the past week in terms of shareholder gains in the company. This is emblematic of the stock. BTCS has a history of dramatic rallies. Moreover, the stock has registered increased average transaction volume recently, with the past month seeing 86% over what the stock has registered over the longer term.
BTCS Inc (OTCMKTS:BTCS) describes itself as an early mover in the blockchain and digital currency ecosystems and the first “Pure Play” U.S. public company focused on blockchain technologies. BTCS goal is to enable users to engage in the digital currency ecosystem through one point of access – the Companys universal digital currency platform. As a firm believer in the blockchain technology, we offer various solutions including Bitcoin Shop – our ecommerce store which accepts a variety of digital currencies, BTCS Wallet – our secure storage solution and more. We deliver each solution by leveraging innovative technologies. We also leverage the services offered by our strategic partners. To date we have made investments in and partnered with 4 key digital currency companies including: GoCoin, Gem, Expresscoin, and Coin Outlet.
BTCS operates a beta eCommerceE marketplace. It hosts an online ecommerce marketplace where consumers could purchase merchandise using digital currencies, such as bitcoin, litecoin, and dogecoin. The company was formerly known as Bitcoin Shop, Inc. and changed its name to BTCS Inc. in July 2015. BTCS Inc. was founded in 2013 and is headquartered in Arlington, Virginia.
According to press materials, “BTCS is one of the first U.S. publicly traded companies focused on digital assets and blockchain technologies. Subject to additional financing, BTCS plans to create a portfolio of digital assets including bitcoin and other “protocol tokens” to provide investors a diversified pure-play exposure to the blockchain space. The blockchain is a decentralized public ledger and could fundamentally impact all industries on a global basis that rely on or utilize record keeping and require trust. BTCS is keenly focused on growth through acquisition and intends to acquire digital assets through open market purchases and participation in initial digital asset offerings (often referred to as initial coin offerings). Additionally, BTCS may acquire digital assets by resuming our transaction verification services business (often referred to as mining) through outsourced data centers, earning rewards in digital assets by securing their respective blockchains.”
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As discussed above, traders and investors on the OTC see shares of BTCS as a correlated play with the larger bitcoin and crypto space. But the action performance of the stock has badly lagged. That said, over the very recent term, we have seen some sharp upside, and that has come along with a move to new all-time highs in Bitcoin. Could that be the start of this stock making up ground?
Well, we would be remiss if we didn’t point out the fact that the primary thrust higher in recent days for BTCS was clearly spurred on by more than just a Bitcoin breakout: the company just announced that it has secured $1,000,000 in financing, which includes $250,000 (59.38) in bitcoin.
“This financing represents a major milestone in the ongoing evolution of our Company,” stated Charles Allen, CEO of BTCS. “With the opportunity in the burgeoning blockchain space is still in its infancy, our planned merger with Blockchain Global Ltd. positions us with a diversified business model that sets the stage for market leadership globally, and this financing represents a strong commitment to move forward.”
Frankly, if you want to increase correlation with Bitcoin, just hold your assets in Bitcoins and sit on them. Taking a quarter million in financing in the form of Bitcoin should help to heal the divide. However, investors would be wise to remember that knife cuts both ways going forward.
Now commanding a market cap of $29.8M, BTCS has virtually no cash on the books, which must be weighed relative to virtually no total current liabilities. BTCS is pulling in trailing 12-month revenues of $360K. However, the company is seeing declines on the top-line on a quarterly y/y basis, with revenues falling at -97.9%. This may be a very interesting story and we will look forward to updating it again soon. Sign-up for continuing coverage on shares of $BTCS stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in $BTCS, either long or short, and we have not been compensated for this article.