IP Strategy earns $1.5M in staking rewards through new validator business

GIG HARBOR, Wash. - IP Strategy (NASDAQ:IPST), a $20.84 million market cap company, has launched its validator business on the Story Network, generating approximately $1.5 million worth of $IP token rewards in its first two weeks of operation, according to a company press release issued Thursday. According to InvestingPro data, the company has shown strong recent momentum despite a challenging year-to-date decline of 54%.

The company, which describes itself as the first to adopt a treasury reserve policy centered on the $IP token, has self-staked 43.5 million unlocked $IP tokens since testing began on September 6, with the validator going live on September 18. This activity has earned nearly 165,000 $IP tokens in rewards.

IP Strategy estimates its validator business could generate approximately 3.2 million $IP tokens annually at a blended yield of about 6%, potentially worth $28.5 million in annual revenue based on the September 30 closing price of $8.91 per token. The company projects fixed costs between $400,000 and $500,000, suggesting gross margins above 95%.

In addition to staking its own treasury assets, IP Strategy has begun onboarding third-party participants who stake their $IP tokens on its validator, creating another potential revenue stream through commissions.

"Launching the validator business demonstrates how IP Strategy is evolving from simply holding $IP as a reserve asset to actively generating recurring revenue from it," said Seung Yoon SY Lee, CEO and Co-Founder of PIP Labs and Chairman of the IP Strategy Advisory Board, in the press release.

The validator launch follows IP Strategy’s transition to a digital asset treasury strategy, which added more than 53.2 million $IP tokens to its balance sheet and eliminated all senior secured debt.

On proof-of-stake blockchains like the Story Network, validators are responsible for securing the network, confirming transactions, and maintaining uptime, earning token rewards in return.

IP Strategy trades on the Nasdaq under the ticker IPST.

In other recent news, Heritage Distilling Holding Company, Inc. has completed a $223.8 million private placement offering, comprising $95 million in cash and $128.8 million in $IP tokens. This transaction allowed the company to eliminate $19.3 million in debt and future liabilities, reducing annual interest expenses by over $2 million. Heritage Distilling also announced a strategic shift towards accumulating $IP tokens, marking it as the first Nasdaq-listed company to adopt a treasury reserve strategy focused on programmable intellectual property. The company plans to rebrand its operations under the name "IP Strategy" as part of its pivot towards the intellectual property economy. Additionally, Heritage Distilling has raised approximately $4.8 million by selling 11.96 million shares of its common stock to C/M Capital Master Fund, LP. This sale is part of a broader agreement permitting the company to sell up to $15 million in newly-issued common stock. Furthermore, Heritage Distilling will change its Nasdaq ticker symbol from CASK to IPST to align with its new strategic focus. These developments reflect Heritage Distilling’s significant moves in financial restructuring and strategic realignment.

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