Thumzup Media Corporation said, on Wednesday, August 13, it will expand into large-scale cryptocurrency mining and target blockchain investments after raising $50 million.
The company closed a $10 per share offering on Tuesday and plans to use the proceeds to build mining infrastructure and back selected crypto projects.
The firm is based in Los Angeles and moved into crypto in January by buying Bitcoin. The board has cleared up to $250 million in total crypto holdings as Thumzup seeks to grow its digital asset business.
Funding and plans
Thumzup raised the money through a public offering priced at $10 per share. The firm said part of the capital will pay for state-of-the-art mining rigs and related equipment. Company leaders are in talks with mining technology providers to speed up deployment.
The firm also said it will pursue targeted investments in blockchain companies. That push follows its January pivot to hold most of its liquid assets in Bitcoin. The new funding is meant to back both mining and wider crypto holdings.
Crypto holdings and targets
Thumzup currently holds 19.1 BTC. The company said it will also add Dogecoin, Litecoin, Solana, XRP, Ether, and USDC to its portfolio. The board has authorised holdings of up to $250 million in crypto assets in total. The firm said the mix is meant to diversify its digital asset exposure beyond Bitcoin.
UnoCrypto reported, in early July, Thumzup drew further attention when Donald Trump Jr. bought 350,000 shares. That stake was worth about $3.3 million at the time, according to regulatory filings.
Market reaction and stock moves
Shares of Thumzup, ticker TZUP, rose 7.62% in after-hours trading to $10.87 on Wednesday. That move reversed a 1.1% decline in the regular session. The stock is up about 194.5% year to date. Its recent high was $15.46 on Aug. 8.
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Earlier this week, the stock slid nearly 33% after the company announced plans for a public offering of non-voting convertible preferred stock and then revised those plans.
The shares also jumped almost 75% over four sessions before falling 17% by mid Wednesday. In after-hours trade, the stock gained ground again.
Business background
Founded in 2020, Thumzup runs a social app that pays users for product recommendations on Instagram. The platform rewards users with cash when they promote branded content.
The company is based in Los Angeles and has shifted its focus this year from pure social media marketing to crypto investments.
Financially, Thumzup reported a $2.2 million loss in Q1 on revenue of $151. That small revenue figure contrasts with the stock’s large price swings. Company executives have argued that the pivot to crypto could reshape its balance sheet over time.
Risks and questions
Investing in mining and holding crypto brings fresh costs and risks, and mining requires heavy upfront spending on machines, power, and cooling. The price of Bitcoin and other digital assets can swing widely and affect returns.
The company has not released a detailed timetable for when mining operations will begin or how much of the $50 million will be used for equipment versus investments.
Thumzup will also face scrutiny from investors about governance and capital use. The recent stake purchase by a high-profile investor added attention, but it also raises questions about who benefits from the new strategy.
Also Read: Trump Media’s Bitcoin Holdings Reach $2 Billion, Making It 67% Of Its $3 B In Liquid Assets