SharpLink Gaming Will Deploy $200M ETH on Linea L2

SharpLink Gaming (NASDAQ: SBET), the second largest Ethereum digital asset treasury (DAT), will deploy $200M ETH to EigenCloud through ether.fi using the Linea L2 blockchain. Consensys – a prolific Ethereum software developer and crypto investment conglomerate – is an investor in SharpLink, ether.fi, and Linea.

What's the Scoop?

• Institutional-Grade Deployment: SharpLink’s $200M allocation to EigenCloud will be deployed via ether.fi on the Linea blockchain. All assets will be custodied by Anchorage Digital Bank, a federally chartered crypto bank.
• Yield Focus: The strategy will enhance baseline ETH staking yield with EigenCloud rewards and token incentives from Linea/ether.fi. SharpLink believes its capital deployment can enable the company to "capture highly competitive, differentiated, risk-adjusted, ETH-denominated returns."
• Institutional Vision: In a press release about the yield farming strategy, Consensys CEO and SharpLink Chair Joseph Lubin claimed the move reflects Ethereum’s growing role in institutional finance and showcases how institutions can safely earn native yield on Linea.
• Price Impact: SBET, which experienced a minor rally during pre-market trading on the announcement, fell throughout regular trading and was ~2.5% below Monday's close at the time of writing, despite flat ETH prices. LINEA token prices were similarly down ~2.2% on the day.

Bankless Take:

Considering the close ties between Consensys and its proxies, the potential that SharpLink would leverage its ETH treasury to generate yield on Linea was already widely anticipated. While it makes sense for Consensys to capitalize on the obvious synergies between portfolio companies, markets were little surprised by this development.