• The Lisk Foundation is converting 1,000 bitcoin (BTC) to Ethereum (ETH) over the next 10 weeks.
• The ETH purchased will be deposited into a 2-of-3 multisig account, with each board member of the Lisk Foundation holding one key.
• The project also intends to retain 500 BTC to cover expenses in 2024 and 2025.
Lisk Foundation to Sell 1000 Bitcoin for Ethereum
The Lisk Foundation, led by co-founder and CEO Max Kordek, announced plans to convert its holdings of 1,000 bitcoin (BTC) into ethereum (ETH). This conversion will take place over the next 10 weeks. As part of minimizing risks associated with third parties, 100 BTC will be sold every week for the two and a half months duration.
Investment Aimed at Bolstering Long-term Treasury
The ETH purchased will be deposited into a 2-of-3 multisig account held by board members of the Lisk Foundation. The move is aimed at bolstering their long-term treasury assets. Kordek clarified that they intend to stake the acquired ETH while also retaining 500 BTC to cover expenses in 2024 and 2025.
Reasons Behind Decision to Sell BTC for ETH
Kordek outlined three main reasons behind the decision to sell BTC for ETH: firstly, Ethereum’s position as the largest smart contracting platform aligns with their treasury goals; secondly, ETH has acceptable risks from a treasury perspective; lastly, Ethereum’s staking mechanism may provide sustainable ROI.
Potential Impact on Bitcoin Price
The ICO frenzy of 2016 and 2017 saw Lisk raise 14,000 BTC. With a current market cap of $106m, it stands ranked 195th according to CoinMarketCap data. Although it remains unclear how much impact this sale could have on bitcoin prices moving forward – especially given that there are many other large players who may enter or exit positions – it is worth noting that these moves often cause short term volatility in markets.
Conclusion
It’s clear that the Lisk Foundation intends to take advantage of Ethereum’s staking capabilities while covering their expenses until at least 2025 through their retained 500 BTC holdings. In doing so they hope to maximize returns on investment while minimizing exposure risk through selling off chunks weekly rather than one lump sum transaction