TON Strategy Company, previously known as Verb Technology Company, said on Friday it repurchased 250,000 shares of its common stock under its $250 million buyback agreement.
According to the announcement, TON Strategy Company repurchased the shares at $8.32 each, below the treasury asset value of $12.18. The buyback comes just weeks after it revealed a $713 million reserve of Toncoin (TON) tokens on Aug. 21. TON Strategy says its buyback indicates “long-term confidence” in the TON ecosystem.
The TON token is the native cryptocurrency of The Open Network, a project that started in 2018 and was initially conceived to bring blockchain to messaging service Telegram. The crypto token is ranked No. 22 overall in market capitalization, with its price is declining 40.7% year-to-date, according to Cointelegraph indexes.
The repurchases come as the company’s share price has fallen 21.6% since adopting the TON reserve treasury.
TON Strategy’s shares declined 7.5% on the buyback announcement Friday.
The company also announced the beginning of its staking operations to generate onchain income from its treasury holdings.
“Staking introduces a recurring revenue stream into our model, while buybacks allow us to enhance shareholder returns,” TON Strategy Company CEO Veronika Kapustina said in a statement.
Staking is the process of locking up cryptocurrency to support a blockchain network’s operations, such as validating transactions, in exchange for rewards. According to Staking Rewards data, there are 340 validators actively staking on the TON network, with annual reward rates at 4.8% as of this writing.
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TON treasury companies and other DATs
TON Strategy Company became the first publicly traded company to start a Toncoin treasury in August. In July, Bloomberg reported that the TON Foundation and Kingsway Capital Partners, a London-based investment management firm, sought to raise at least $400 million to start a TON treasury company.
Crypto exchange Coinbase recently said that crypto treasury companies are entering a “player vs player” stage where investor money will become harder to find.
The New York Digital Investment Group said Sunday that premiums are narrowing for such companies and may continue to do so.
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