SOS Ltd. Announces $50M Bitcoin Purchase, Shares Surge 40%

SOS Ltd., a China-based financial services firm with a Bitcoin mining operation in Wisconsin, has revealed plans to buy $50 million worth of Bitcoin, sending its stock up over 40%. This move marks the company’s latest effort to capitalize on the growing cryptocurrency market.

On November 27, SOS announced that its board of directors approved the purchase as part of the company’s "long-term belief in Bitcoin’s role as a store of value and a strategic asset." SOS plans to deploy a combination of "investing, trading, and arbitrage strategies" to maximize returns and manage market volatility with its Bitcoin holdings.

SOS Chairman and CEO, Yandai Wang, commented that Bitcoin’s performance has been strong, bolstered by positive developments such as the introduction of Bitcoin-related ETFs and ongoing improvements in the U.S. regulatory environment for digital assets.

Following the announcement, SOS shares surged nearly 43% to $9.93, with an additional 14.5% increase in after-hours trading, reaching $11.36, according to Google Finance.

However, SOS’s stock has faced significant challenges this year. It’s down approximately 86.5%, and in August, the New York Stock Exchange (NYSE) issued a noncompliance letter due to the company’s poor stock performance. The shares have essentially lost all value since their peak of $84,900 in October 2017.

SOS’s Bitcoin investment follows a broader trend among companies trying to tap into the current cryptocurrency rally. Bitcoin has seen a dramatic 40% increase in value over November, rising from around $70,000 to near $100,000, with a high of $99,860 on Coinbase on November 24.

In a similar move, Rumble, the far-right YouTube alternative, announced plans to purchase $20 million worth of Bitcoin, which resulted in a nearly 13% rise in its stock. Rumble, like SOS, has struggled with a declining stock price and has yet to reach profitability.

Another company, Genius Group, an AI-backed education provider, also made a Bitcoin purchase earlier this month, buying $10 million worth of Bitcoin and signaling plans to eventually hold up to 90% of its reserves in Bitcoin.