GameSquare to review $100 million Ethereum treasury strategy

FRISCO, Texas - GameSquare Holdings, Inc. (NASDAQ:GAME), currently trading at $1.51 with a market capitalization of approximately $60 million, has scheduled a conference call on July 16 at 12:00 p.m. ET to discuss its recently announced $100 million Ethereum treasury strategy, according to a press release statement issued Tuesday. The company’s stock has shown remarkable momentum, gaining over 115% in the past six months. According to InvestingPro analysis, GameSquare currently appears undervalued based on its Fair Value estimates.

The listen-only call will feature GameSquare CEO Justin Kenna alongside Ryan Zurrer, founder of Dialectic AG, and Rhydon Lee of Goff Capital. The executives will outline Dialectic’s Ethereum yield strategy that GameSquare is implementing. This strategic move comes as InvestingPro data shows the company faces challenges with cash burn and weak gross profit margins of 15.3%.

The company’s approach aims to generate on-chain yields of 8-14%, significantly higher than current Ethereum staking benchmarks of 3-4%. GameSquare is utilizing Dialectic’s Medici platform, which employs machine learning and automated optimization with risk controls to manage its Ethereum assets.

"We believe our relationship with Dialectic and new treasury management program deserves to be evaluated not just as a balance sheet investment, but as a yield-generating business vertical with real cash flow," said Kenna in the statement.

The company projects that once fully implemented, the strategy could generate over $10 million in annual profitability, which it plans to use for additional Ethereum purchases, potential share repurchases, and growth initiatives.

GameSquare, which describes itself as operating at the intersection of media, gaming, technology and digital assets, completed a capital raise and Ethereum investment last week. The company owns FaZe Clan Esports and operates a gaming media network in North America, generating annual revenues of nearly $100 million with 77% year-over-year growth. For deeper insights into GameSquare’s financial health and growth prospects, investors can access comprehensive analysis through InvestingPro’s detailed research reports, which cover over 1,400 US stocks.

The treasury strategy represents a departure from companies that purchase Ethereum solely for appreciation, as GameSquare aims to generate ongoing yield through decentralized finance protocols and Ethereum ecosystem assets.

In other recent news, GameSquare Holdings, Inc. announced a significant acquisition of $5 million worth of Ethereum, marking the first step in its $100 million Ethereum treasury program. The company aims to generate sustainable yield through decentralized finance protocols, targeting yields of 8-14%. GameSquare has partnered with Dialectic to implement this Ethereum-native yield strategy. Additionally, the company has suspended its at-the-market offering prospectus, as communicated to ThinkEquity LLC, although the Sales Agreement remains in effect. GameSquare also announced an underwritten public offering of common stock shares, with Lucid Capital Markets serving as the sole book-running manager. This offering is subject to market conditions, with no assurance of its completion or terms. The company did not specify how it plans to use the proceeds from this potential offering. These developments highlight GameSquare’s strategic focus on leveraging digital assets and expanding its financial strategies.

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