Trump Media, Crypto.com, and Yorkville launch CRO Strategy firm with $1B in CRO tokens, $5B credit line, and mutual investments.
Trump Media and Technology Group, the company behind Donald Trump’s Truth Social platform, has entered into a new business agreement with cryptocurrency exchange Crypto.com and blank check firm Yorkville Acquisition. Together, they intend to open a new company, which will be called the Trump Media Group CRO Strategy. The new entity will prioritize the creation of a digital asset treasury, where the Cronos (CRO) token will play a crucial role.
CRO Strategy Firm Secures $1B in Tokens, $5B Credit Line
Trump Media, Crypto.com, and Yorkville signed the definitive agreement to create the new company on Tuesday. At the end of the business combination, the three founders of the business will share the ownership of the company. Notably, the new business venture will be the first and largest publicly traded CRO treasury company in history.
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The funding planned on the venture is high. It will entail 1 billion dollars worth of Cronos tokens, or 6.3 billion CRO, or 19% of the total market capitalization of the token. The venture will also receive $200 million in cash. It will get \$220 million from exercised warrants. Yorkville’s affiliate, YA II PN, Ltd., will provide an additional \$5 billion in an equity line of credit. These characters speak of the size and grandeur of the project.
To supplement the transaction, YA II PN, Ltd. has accepted a backstop agreement.YA II PN, Ltd. will buy Class A shares of Yorkville Acquisition Corp. that shareholders submit for redemption. However, it will not own more than 9.9% of the total shares. This will provide stability in the deal without excess control by one party. In the interim, Yorkville Acquisition Corp. will seek to trade its Class A stock on the Nasdaq exchange under a new ticker, MCGA. This logo will subsequently change to the new Trump Media Group CRO Strategy upon closing of the business combination.
Trump Media, Crypto.com Sign One-Year Lock-Up on CRO Venture
According to Reuters, Trump Media has agreed to purchase $105 million in CRO tokens for its corporate balance sheet. At the same time, Crypto.com will invest 50 million in Trump Media common stock. These investments in each other also reinforce the bonds between the two firms and a willingness to commit to the new venture.
Earlier this year, Trump Media also announced a collaboration with Crypto.com to launch exchange-traded funds (ETFs) and other crypto-related financial products under its new brand, Truth.Fi. The decision is part of a wider trend in the crypto industry, as companies increasingly seek to replicate the success of companies such as MicroStrategy. MicroStrategy is known to have been buying bitcoin since 2020, accumulating more than $100 billion of the cryptocurrency.
It is noteworthy that other large companies, including Cantor Fitzgerald, Tether, and SoftBank, have also entered the crypto industry, further building momentum in the sector.
Trump Media, Crypto.com, and Yorkville have signed a one-year lock-up period on their founding shares and warrants to demonstrate long-term commitment. This will be coupled with another three years of a restricted release plan. Such terminologies are indicative of a belief in the long-term sustainability and success of the Trump Media Group CRO Strategy company.
