BioNexus picks Ethereum over Bitcoin for treasury due to its programmability and utility

Malaysia-based BioNexus Gene Lab announced on Mar. 5 that it has approved its treasury strategy, which prioritizes Ethereum (ETH) over Bitcoin (BTC).

The firm said the decision was driven by Ethereum’s recent inclusion in the US Crypto Strategic Reserve and its “broader utility as a programmable financial platform.”

BioNexus said its Board of Directors’ extensive internal analysis identified Ethereum’s institutional adoption, staking potential, and dominance of financial infrastructure in DeFi as key factors supporting its treasury integration.

As of Sept. 30, 2024, the company’s market cap was $6 million, its revenue was $2.6 million, and its net income was negative $1.3 million. It aims to become the first Nasdaq-listed company to adopt an Ethereum-exclusive treasury strategy, although it does not stipulate the investment amount.

Sam Tan, CEO of BioNexus, stated:

“Ethereum offers high liquidity, utility, and stability compared to other digital assets, positioning BGLC as a leader in blockchain-integrated corporate finance. Wyoming’s regulatory leadership further validates our decision, as it fosters an environment where blockchain businesses can thrive.”

BioNexus also cited Wyoming’s blockchain-friendly regulatory environment, highlighting its “Wyoming Stable Token Act,” as an additional factor in its decision.

The Wyoming Stable Token Act, passed in March 2023, allows the Wyoming Stable Token Commission to issue Wyoming Stable Tokens (WYST), which can be exchanged for US dollars.

Staking and stablecoin rails

In a whitepaper titled “ETH Strategy,” BioNexus argued that Ethereum contrasts with Bitcoin’s primary use as a store of value by offering a staking mechanism that generates an additional yield of 3% to 5% for companies annually, making it an attractive option for treasury management.

The document highlighted the staking property as a key factor in BioNexus’ decision to prioritize ETH for its treasury and emphasized Ethereum’s key role in global finance.

It noted that Ethereum acts as the settlement layer for Tether USD (USDT), USD Coin (USDC), and other stablecoins, and processes trillions of dollars in transactions annually.

The report added that this infrastructure enables cost-effective and efficient cross-border payments, positioning Ethereum as a central component of the digital economy.

Financial infrastructure for institutions

Other key differentiators include Ethereum’s role in enterprise blockchain solutions, financial settlements, and smart contract functionality, while Bitcoin is primarily used as a treasury asset.

Ethereum’s financial solutions mentioned in the whitepaper are the tokenization of financial assets, decentralized payments, and enhanced regulatory compliance, reinforcing its utility in institutional finance.

As a result, banks, investment firms, and publicly traded companies are adopting Ethereum more widely, which signals mainstream financial acceptance. The company also expects an acceleration in corporations’ adoption of Ethereum exchange-traded funds (ETFs).

Additionally, the whitepaper mentions that integrating ETH aligns BioNexus with the ongoing evolution of corporate finance, leveraging blockchain technology to enhance financial efficiency and liquidity management.

The whitepaper expressed optimism about Ethereum’s future upgrades, citing the Pectra update, which will go live in April. Pectra will enhance wallet capabilities, validator operations, network performance, smart contract deployment, and account abstraction.

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