Shares of blockchain technology firm BTCS Inc. (NASDAQ:BTCS) surged Wednesday morning after the company said it would offer a dividend payable in Bitcoin (CRYPTO: BTC).
What Happened: BTCS, which secures Proof-of-Stake blockchains by actively processing and validating blockchain transactions, announced Wednesday the “first-ever” dividend payable in Bitcoin.
The Nasdaq-listed company says its shareholders on record can choose to have dividends paid out either in Bitcoin or cash.
BTCS intends to pay 5 cents per share in Bitcoin, based on the Bitcoin price on the ex-dividend date. Investors who do not elect to receive the dividend in Bitcoin will receive a cash dividend of 5 cents, said the company.
“We want to reward our long-time shareholders for their continued support and encourage financial freedom by providing the means to enable direct ownership of Bitcoin and other digital assets,” said Charles Allen, CEO of BTCS.
Why It Matters: BTCS shares surged significantly following the announcement. Over the course of the last year, a number of companies, including Tesla Inc (NASDAQ:TSLA), have added Bitcoin to their balance sheet — but so far, none have offered a dividend payable in Bitcoin.
While the SEC still remains reluctant to approve a spot BTC ETF, some publicly traded companies that have a sizeable amount of Bitcoin on their balance sheets have seen their stock price move in tandem with the leading digital asset.
For instance, MicroStrategy Incorporated (NASDAQ:MSTR) currently holds 121,044 BTC worth $5.6 billion. The stock has gained 343% since the company announced its first Bitcoin purchase in August 2020.
BTCS Price Action: BTCS shares were trading 38.28% higher at $4.19 late Wednesday morning.
Photo by Dmitry Demidko on Unsplash.
