When the market is strong, DAT firms typically raise funds to buy tokens. As the token price rises, the company’s MV increases as well—creating a powerful positive flywheel. However, this flywheel relies on the company’s continued ability to attract new capital.
Recently we found leading DAT firms starting to sell off their reserves. This could quickly trigger a negative “death spiral” in the opposite direction.
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When the market is strong, DAT firms typically raise funds to buy tokens. As the token price rises, the company’s MV increases as well—creating a powerful positive flywheel. However, this flywheel relies on the company’s continued ability to attract new capital.
Recently we found leading DAT firms starting to sell off their reserves. This could quickly trigger a negative “death spiral” in the opposite direction.