Chinese blockchain infrastructure firm Nano Labs has announced a convertible notes purchase agreement for $500 million to fund its BNB token treasury.
In a Tuesday announcement, the company said it plans to acquire up to $1 billion worth of Binance’s BNB (BNB) token through a combination of convertible promissory notes and private placements. As part of the initiative, Nano Labs will also assess BNB’s security and value.
“Over the long term, Nano Labs aims to hold 5% to 10% of BNB’s total circulating supply,“ the company said in the statement.
The notes will mature in 360 days after issuance, with no interest accruing on the amount. During this period, the notes can be converted in whole or part into Class A ordinary shares of Nano Labs.
The initial conversion price is $20 per ordinary share, but it is subject to adjustment. If the notes are not converted within the allotted time, the company is expected to repay the outstanding principal amount on the maturity date.
Nano Labs noted that the notes are unsecured and warned that “there is no guarantee that closing will happen in full or at all.”
Related: Binance’s BNB Chain rebounds amid institutional, DeFi adoption
CZ responds to Nano announcement
Binance co-founder and former CEO Changpeng “CZ” Zhao shared the Nano Labs announcement in an X post. He further highlighted that the firm’s “stock went through the roof” after announcing the BNB reserve initiative.
CZ also highlighted that he and entities affiliated with him “did not participate in this round. Still, he said that they “remain extremely supportive.”
Nano Labs’ stock price rose by over 106% over the trading day. Currently, it trades at $22.50, having closed at $10.90 on the previous trading day.
Related: Standard Chartered predicts BNB will more than double in 2025
Not the first corporate BNB treasury
This isn’t the first time BNB has caught the attention of institutional investors. Earlier this month, crypto hedge fund executives were reported to be looking to raise $100 million to invest in BNB.
Still, the firm’s offering to investors may soon have some competition on the regulated markets, with asset manager VanEck requesting permission from US regulators to list a spot exchange-traded fund (ETF) that holds BNB.
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