The Wave of Cryptocurrency Treasury Companies on Wall Street: Long-lasting Trend or Passing Fad?

Source: PortaldoBitcoin Original Title: History of 2025: Cryptocurrency Treasury Companies Flood Wall Street Original Link: Cryptocurrency buying companies are destined to become a pillar of Wall Street, or will they be remembered only as another passing fad, echoing previous market expansion and recession cycles?

This question has come to the forefront in recent months, as a long list of companies that collectively raised billions of dollars to accumulate digital assets saw their stock prices plummet after a wave of changes and mergers earlier this year.

Whether NFTs or meme coins, speculation hotspots emerge with each market rally, creating periods of euphoria that inevitably fade. This year, the novelty of cryptocurrency treasury companies lost its charm as several members of the latest sector wave found themselves under pressure, although many still argue that their approach to reshaping the traditional financial landscape is unique.

Several cryptocurrency buying companies that entered the public market this year drew inspiration from Bitcoin accumulation strategies, adopting elements to accumulate everything from Dogecoin to Tron. Still, atypical companies like GameStop put their own spin on the game.

As the year progressed, the pioneer adapted to an increasingly competitive market by issuing new types of securities to add to its stockpile. However, one of its most popular tools lost effectiveness as some of its emerging competitors were acquired.

In a way, the future may be uncertain for cryptocurrency treasury companies, but amid a favorable regulatory environment, it seems more of them will enter the market. In any case, this year may be remembered as the moment when the trend peaked, giving rise to a new class of investments for institutions and individuals to explore.

Regulatory Changes and SEC Approvals

Kristen Smith, president of the Solana Policy Institute, states that a leadership change at the U.S. Securities and Exchange Commission (SEC) likely enabled more cryptocurrency treasury companies to emerge.

The SEC, under the previous administration, would never have approved the existence of these companies.

Instead of going through a lengthy initial public offering (IPO), many cryptocurrency treasury companies emerged from reverse mergers, noting that the process is subject to SEC approval.

The Role of mNAV

If hundreds of publicly traded companies start buying Bitcoin simultaneously, how can investors distinguish winners from losers? The industry’s most basic answer was mNAV.

An abbreviation for multiple of net asset value, this informal metric has become a popular benchmark for assessing a company’s value relative to its cryptocurrency holdings.

Typically, a company’s mNAV is calculated by dividing its market value by the net value of its cryptocurrency holdings, resulting in a multiple that reflects a premium or discount. However, some companies calculate mNAV using enterprise value instead of market value, which accounts for debt and available cash.

The multiple is important for cryptocurrency treasury companies beyond measuring market sentiment. It is also fundamental to one of the most popular approaches to raising capital for Bitcoin purchases.

When mNAV is positive, the company can issue common stock to buy Bitcoin in a way that increases its holdings per share. Many startup companies adopted this metric as their guiding principle, increasing their cryptocurrency holdings per share as their main goal.

Cryptocurrency treasury companies that debuted this year appeared in all formats and sizes. Some previously cultivated cannabis before turning to digital assets or manufactured medical devices. In fact, Japan’s largest corporate Bitcoin holder, Metaplanet, operated the so-called love hotels.

Many cryptocurrency treasury companies saw their mNAVs soar initially, but their stock prices eventually fell below the value of their cryptocurrency holdings.

Different Strategies

No one considers giants like Tesla as cryptocurrency treasury companies, but the automaker has held 11,500 Bitcoins on its balance sheet for several years.

The same can be said for GameStop, the video game retailer that announced the purchase of 4,710 Bitcoins in May. After spending $512 million on the asset, these reserves were worth $438 million at the beginning of December.

Despite photos alongside leaders of other accumulation strategies, GameStop’s CEO has stated from the start that the company “is not following anyone’s strategy” when it comes to accumulating Bitcoin.

Despite lobbying efforts for major companies like Meta and Microsoft to start accumulating Bitcoin, both rejected similar proposals. Bitcoin was not adopted by the seven largest companies in the sector, but about 200 publicly traded companies now hold Bitcoin on their balance sheets. About two dozen hold Ethereum.

An increasing number of cryptocurrency buying companies has made it harder for companies to differentiate themselves while reducing the visibility of established firms.

There has been a proliferation of these companies, leading to fragmentation of attention and liquidity.

In September, a major company announced the acquisition of another for $1.3 billion. At the time, its market value had fallen below the value of its cryptocurrency holdings. Other companies with declining mNAVs decided to buy back their shares or even sell their cryptocurrencies.

Beyond Bitcoin

This year, it seemed that any company could become a cryptocurrency treasury company. This includes a Tron-buying company specializing in toys and theme park products.

But, at some point, acquiring digital assets on a company’s balance sheet was not so easy. And keeping them there was even more difficult.

In 2023, there were cases of companies adopting Bitcoin and Ethereum as treasury reserve assets but later abandoning the plan due to lack of board support.

Some companies are accumulating Toncoin, the cryptocurrency used for gaming and transactions on specific blockchain networks. These companies are actively developing, incubating, and accelerating businesses within specific ecosystems, from DeFi and gaming to commercial applications.

Many cryptocurrency treasury companies are also leveraging staking — committing a certain amount of native tokens from a blockchain network to the network itself in exchange for rewards. By participating in transaction validation on proof-of-stake networks, many companies have managed to use their assets to generate additional revenue.

Some companies focus on staking as much as possible while building their own validator networks. Others, larger holders of specific assets, are also betting on becoming validators themselves.

Exit Strategy

At the end of the year, the future looked increasingly uncertain for many cryptocurrency buying companies seeking to capitalize on one of Wall Street’s hottest trends.

With mNAVs showing discounts, many new companies’ fundraising capacity was limited. Still, some companies remained committed to their efforts to accumulate digital assets, with specific goals, including owning a certain amount of a cryptocurrency’s supply.

If the hype around cryptocurrency treasury companies continues to fade, giants may consider lending their bitcoins. However, this option may not be feasible for cryptocurrency buying companies that made their first purchase just a few months ago.