Unlocking Bitcoin - Mar. 27, 2025
News on Bitcoin, tokenized financial networks and Sypher Capital
🟢 Sypher Capital News
Sypher Bitcoin Yield Fund Cohort 3
Sypher Bitcoin Yield Fund is now raising investment contributions for cohort 3 of its investment fund to be successfully deployed into our yield-bearing strategy. Cohort 3 is currently targeted for mid-April. Feel free to reach out to learn more.
💎 Bitcoin News
Can Gold Gains Fund a U.S. Bitcoin Reserve?
The U.S. holds over 261 million troy ounces of gold, but still values it at $42.22/oz (~$11 billion). This originated from the Par Value Modification Act of 1973, which authorized the Secretary of Treasury to establish a new par value for the dollar - defined as $42.22 per fine troy ounce of gold. At today’s market price (~$2,900/oz), those reserves are worth nearly $761 billion, or $750 billion in unrealized gains.
Last week, a White House Executive Director for Trump’s Digital Asset Advisory Council suggested those gains could theoretically be used to buy Bitcoin — without additional spending.
“If we actually realize the gains on [the U.S. gold holdings], that would be a budget-neutral way to acquire more bitcoin…”
- Bo Hines, White House Exec. Director for Trump’s Council of Advisers on Digital Assets
At current prices, that realized gain could hypothetically purchase over 9 million BTC, more than 40% of total supply. Of course, that much Bitcoin couldn’t be acquired without dramatically moving the market — but that’s precisely the point.
To be clear, we believe that Congress would need to pass legislation to mark gold reserves to market. In fact, Senator Lummis’ BITCOIN Act, which looks to purchase 1m BTC over 5 years, includes a provision for the Federal Reserve to update its gold mark to current prices, which would be used to fund the Bitcoin purchases.
Thus, it’s possible the U.S. may never make that trade. Additionally, there are skeptics on the idea of a Bitcoin Strategy Reserve, but the fact the concept is being floated at all suggests Bitcoin’s role as a strategic reserve asset is gaining momentum.
We updated our Bitcoin presentation with the slide below. To see the full deck, click here.
Gamestop Announces It Will Add Bitcoin to Its Treasury
While we typically hesitate to highlight GameStop—given its meme-stock legacy and volatility—we believe this announcement is noteworthy within the broader narrative of corporate Bitcoin adoption.
On the day it announced its Q424 results, GameStop announced its board unanimously approved an update to its investment policy to add Bitcoin as a treasury reserve asset. The stock traded +11% the following day.
GameStop does not hold earnings calls, so details were limited to the release, but as of 2/1/25 the company holds $4.8b of cash and only $7m of debt. According to the 10-K, the company has “not set a maximum amount of Bitcoin we may accumulate.” The 10-K also notes that GameStop may use “a portion of our cash or future debt and equity issuances” to invest in Bitcoin.
The very next day, GameStop put out another press release announcing the offering of $1.3b of 0.0% Convertible Senior Notes due 2030, with an option to sell $200m more. GameStop can pay with cash OR shares at conversion. The conversion price will likely be at-the-money as it will be based on the price of GME stock on the date of pricing. The text states that GME can pay in cash or stock “at its election,” which essentially makes this an equity offering, but one that gives GME the option of avoiding dilution by paying all or some portion in cash at conversion. We might be misreading something in the press release, but those terms don’t may not make sense from the holder’s perspective…
I’m sure this will be cleared up in the days ahead, but more broadly we hope this continues the trend of corporate adoption of Bitcoin that we outlined in our recent The Bitcoin Tipping Point presentation. As a reminder, the constituents of the S&P 500 alone hold $8T of cash on their balance sheets. We think the adoption from this vector will be slow and initially limited to the tech or tech-adjacent corporates, but the global opportunity is massive.
🔓 Bitcoin Layer-2 News
Sypher Attends Figment’s Digital Asset Sidebar V4
Sypher Capital recently had the honor of attending Figment’s (the largest independent staking finality provider) conference, which brought together asset managers, investors and builders to discuss the continued adoption of blockchain by traditional finance. Some of our favorite highlights:
Jacob Phillips (CEO of Lombard) says “I think years from now, it’s going to be broadly accepted that it was silly that we built DeFi ecosystems on other assets (vs. Bitcoin). All centralized exchanges are built on Bitcoin. Why would the on-chain financial world look any different?”
Phillips went on to note that Babylon represents the fastest institutional adoption of non-custodial technology seen in crypto to date.
Owen Lau (OpCo Senior Research Analyst on Exchanges, Asset Mgrs) notes that crypto-related calls made up about 10% of his conversations, but that figure has increased to 40% in 2025. Notes he thinks staking is similar to fixed income, but it has an unlimited maturity and custody of the collateral isn’t required.
Christine Moy (Apollo, Head of Digital Assets) had the best articulation of what a world with ubiquitous real world tokenization looks like (we wish there was a video of it!).
Special thanks to the team at Figment for the invite and we appreciated meeting many of the panelists afterwards.
🧐 Sypher Portfolio News
Mighty Bear: Secures $4M to Scale AI Agents in Telegram Games
We are thrilled to announce that our portfolio company, Mighty Bear Games, has secured $4 million in strategic funding to advance its GOAT Gaming platform. This innovative platform leverages AI agents, known as AlphaGOATs, to autonomously play Telegram games, earning rewards on behalf of human players. The recent investment will accelerate the development of GOAT Gaming's AI infrastructure and expand its ecosystem to include third-party developers, reinforcing its position at the forefront of AI-driven gaming experiences.
Chainalysis: Co-Founder Jonathan Levin Assumes CEO Role
We’re excited to share that our portfolio company, Chainalysis—a leading blockchain data platform known for combating crypto crime—has appointed co-founder Jonathan Levin as CEO. As the company broadens its focus beyond law enforcement to serve financial institutions and crypto businesses, Levin aims to position Chainalysis as essential infrastructure for the next era of digital finance and regulation. His leadership comes at a pivotal time, with rising geopolitical tensions and a shifting U.S. regulatory environment.