FG Nexus Sells $31M ETH for Share Buyback, Stock Dips 7%

FG Nexus (FGNX) has executed a significant treasury reallocation, selling 10,922 Ethereum tokens worth approximately $31.3 million at current prices. This move represents a substantial portion of the Ethereum holdings the firm accumulated just months earlier, when it raised $200 million through a private placement in July to initiate its Ethereum treasury strategy. By the end of September, FG Nexus had acquired more than 50,000 ETH, positioning itself as a notable player in the publicly traded Ethereum treasury space.

The market reaction was immediately negative, with FGNX shares falling more than 7% following the announcement. This single-day decline pushed the firm’s monthly losses to nearly 37%, reflecting investor concerns about the company’s strategic direction and the broader pressure on crypto-focused public companies. The stock now trades at $2.41, well below the $3.94 average price the company paid for its own share repurchases and a dramatic fall from its August peak above $40.

FG Nexus is directing the entire $31.3 million proceeds from its Ethereum sale toward accelerating share repurchases, complementing an existing $200 million buyback program. According to Chairman and CEO Kyle Cerminara, the company has already repurchased 8% of its outstanding shares ‘at a substantial discount to our net asset value.’ The firm has bought back approximately 3.4 million FGNX shares at an average cost of $3.94 each.

Cerminara framed the strategy as mathematically advantageous for remaining shareholders. ‘We plan to continue buying back shares while our stock trades below NAV, which creates an increasingly asymptotic effect on our per-share valuation metrics as the number of shares outstanding declines and net asset value per share increases,’ he explained in a statement. This approach mirrors tactics employed by other digital asset firms like SharpLink Gaming, which have utilized share repurchase programs when their market-to-net asset value (mNAV) ratios dipped below 1.

Despite the substantial Ethereum sale, FG Nexus maintains significant crypto exposure with 40,005 ETH worth approximately $115 million and an additional $37 million in USDC stablecoins. This positions the firm just outside the top seven largest publicly traded Ethereum treasuries, maintaining its status as a substantial institutional holder of the cryptocurrency despite reducing its position.

FG Nexus is not alone in leveraging Ethereum holdings to fund shareholder returns. In October, ETHZilla informed shareholders it had sold around $40 million worth of ETH to buy back shares, establishing a pattern among Ethereum treasury firms facing similar market conditions. The common thread appears to be companies responding to stocks trading below net asset value by liquidating portions of their crypto holdings to repurchase discounted shares.

The broader context reveals significant challenges for crypto-focused public companies. FGNX has declined more than 85% over the last six months of trading, reflecting the difficult environment for firms bridging traditional finance and digital assets. The company’s strategic pivot from its former identity as Fundamental Global to embrace an Ethereum treasury strategy has yet to deliver sustained shareholder value despite substantial treasury accumulation.