Semler Scientific Is Going Full Steam Ahead With Its Bitcoin Strategy

Semler Scientific, a healthcare tech company, is going full steam ahead with its Bitcoin strategy.

Semler Scientific (NASDAQ:SEML) is heating things up with its Bitcoin strategy. The company just filed a new S-3 registration with the SEC, opening the door for a capital raise of up to $500 million.

This offering will see a mix of securities like common stock, debt, and warrants. While the funds will be used for general corporate purposes, including working capital and paying down debt, a portion of the offering proceeds will go toward expanding Semler’s Bitcoin treasury holdings even further.

A Major Bitcoin Holder

Semler is no stranger to crypto. As of March, the company disclosed that it owns 3,192 BTC, making it one of the largest Bitcoin holders among publicly traded firms.

Earlier this year, Semler added 871 BTC for $88.5 million, with an average price of over $101,000 per coin. This purchase followed a separate $30 million investment in Bitcoin late last year.

Bitcoin has recently dipped below the $99,000 mark, but Semler appears to be in no hurry to slow down its long-term crypto strategy. In his statement on the new capital offering, Semler Scientific CEO Eric Semler expressed enthusiasm for buying more BTC.

Bitcoin as a Corporate Lifeline

This shift is part of a larger turnaround story. Before adopting its Bitcoin treasury strategy in May 2024, Semler was a stagnant rich public company with solid cash reserves but poor stock performance.

Now, however, Semler is making headlines for its massive Bitcoin accumulation and bold investment strategy. The firm’s executives believe that Bitcoin is not only a hedge against inflation but also serves as a safe haven during times of global uncertainty.

Semler is also in the midst of settling a major case with the Department of Justice. The company recently disclosed that it has reached a tentative agreement to pay $29.75 million to settle allegations from the DOJ regarding the marketing of its QuantaFlo product.

To fund this settlement, Semler plans to borrow from Coinbase (NASDAQ:COIN) and use a portion of its Bitcoin holdings as collateral. Additionally, the company will be tapping into its existing cash on hand to cover part of the cost.

High-Risk Strategy

Despite its bold Bitcoin stance and recent efforts to diversify revenue streams with new products like the Lung Cancer Screening System, Semler’s stock hasn’t seen the boost you’d expect. In fact, the share price has taken a hit, shedding 37% so far this year.

This signals that although Semler is attempting to integrate new technologies and adjust to the evolving healthcare landscape, the company's stock performance remains a concern for investors.

As Semler continues to build its crypto portfolio and adjust its business strategy, the question remains: will this high-stakes strategy pay off in the long run? Only time will tell if these capital raising plans and new products will be enough to turn the tide for Semler in 2024.