Corporate Crypto Treasury Buying Plummets 76% Since July
Bloomberg reports a significant decline in corporate investment in crypto treasuries, marking a notable shift in market trends.
- Publicly traded digital-asset treasury purchases dropped from 64,000 Bitcoin (BTC) in July to 12,600 in August, with September at 15,500, a 76% decrease.
- Bitcoin's value fell nearly 6% over the past week due to broader selloffs and liquidations.
- Treasury shares that raised capital through PIPE deals saw valuations fall by up to 97% below initial prices.
- US authorities are investigating unusual trading activity in digital-asset treasury shares.
- Lack of transparency in crypto acquisition prices and share counts is noted, especially with PIPE deals involving warrants.
- Market-cap-to-NAV multiples indicate a closing gap between stock prices and Bitcoin reserves' value.
Diminished Institutional Support
- Corporate buyer retreat contributes to a "feedback loop" affecting institutional support and demand.
- Derivative markets experience stress; $275 million worth of Bitcoin longs liquidated in 24 hours.
- However, crypto-related products like the iShares Bitcoin Trust ETF saw inflows increase to $2.5 billion in September.
- Jeff Dorman from Arca notes the market's current caution stems from reduced digital asset treasury activity.
