Nano Labs Raises $500M via Convertible Notes to Build BNB Treasury

Chinese blockchain infrastructure firm Nano Labs announced Tuesday an agreement to issue convertible promissory notes, aiming for a $500 million transaction to acquire BNB tokens.

Per the announcement, Nano Labs intends to purchase as much as $1 billion in market value of Binance’s native cryptocurrency, BNB (BNB), through convertible notes, alongside private placements. The company will concurrently conduct an in-depth assessment of the BNB token’s security and value propositions.

Nano Labs cited a long-term objective to eventually hold between 5% and 10% of the total circulating BNB supply.

The newly issued notes have an initial maturity period of 360 days with no accrued interest. Investors retain the option, while notes mature, to convert the debt into Nano Labs’ Class A ordinary shares at a starting discount of $20 per share, subject to standard adjustments.

Unsecured financing is involved, and failure to convert by the expiry date would necessitate repayment of the principal amount. Critically, the company emphasized the uncertainty regarding the full execution of the offering.

In response to Tuesday’s announcement, Binance co-founder Changpeng “CZ” Zhao shared it on his X account. He highlighted a subsequent significant surge in the company’s stock price following the news. Although noting that he and affiliated entities “did not participate in this round,” Zhao reasserted the Binance group’s continued strong support for the venture.

The stock price reacted sharply during Wednesday’s trading session, closing $1.60 higher to $22.50, a more than 150% increase from the previous day’s close of $10.90.

Looking beyond Nano Labs, this initiative isn’t an isolated institutional appeal for BNB. Crypto market intelligence had recently spotlighted fundraising activities being explored by executives from various hedge funds to specifically raise capital for BNB investments. Furthermore, an increasing indication suggests that institutional access to BNB may be forthcoming through regulated exchanges, with asset manager VanEck petitioning U.S. regulators for approval to launch a spot BNB ETF.