Benzinga | Apr 23, 2021 08:03AM EDT

LM Funding To Purchase Up Tp $2M In Digital Assets

LM Funding America, Inc. (NASDAQ:LMFA) ("LM Funding" or "LMFA"), a technology-based specialty finance company, today announced plans to purchase up to $2 million in digital assets. The purchase of Bitcoin, Ether and other digital assets that are not securities is part of LMFA's capital allocation strategy. This purchase will represent approximately ten percent of LMFA's assets. In addition, LMFA is pursuing development of transactional capabilities involving digital assets both organically and through potential acquisitions.

"We believe certain digital assets already provide an alternative to storing value in cash and cash equivalents while the blockchain technology used by other digital assets will provide the backbone for a variety of transactions in the near future", said Bruce M. Rodgers, Chairman and CEO of LMFA. "The community associations that we service are required to maintain reserve accounts that could benefit from the value preservation features of some digital assets. Additionally, we foresee increased use of blockchain technology and digital assets throughout the real estate transactional ecosystem. Our interest in developing and acquiring transactional capabilities involving digital assets requires that we implement the corporate governance and internal controls necessary for a public company to hold and transact business using digital assets. We plan to purchase, hold, and account for our newly acquired digital assets using vendors who have established best practices within the digital asset ecosystem."

On January 28, 2021, LM Acquisition Opportunities, Inc., a special purpose acquisition company ("LMAO") sponsored by LMFA, completed an upsized initial public offering resulting in proceeds of $103.5 million. Mr. Rodgers said, "We believe LMFA's digital asset strategy will make LMAO more attractive to potential targets operating financial technology businesses using digital assets."

LMFA intends to announce further developments, including digital asset purchases and material vendor relationships, as they materialize.