Corporate Crypto Treasury Buying Plummets by 70%, Signaling Major Market Shift
A recent report from Bloomberg has unveiled a dramatic decline in corporate investment in crypto treasuries, highlighting a significant shift in market sentiment. This pronounced downturn, particularly evident in publicly traded digital-asset firms, indicates a period of heightened caution and regulatory scrutiny within the cryptocurrency space.
Crypto Firms Face Steep Valuation Declines
Purchases by publicly traded digital-asset treasuries have seen a precipitous drop, plummeting from 64,000 Bitcoin (BTC) in July to a mere 12,600 BTC in August, with September figures hovering around 15,500 BTC. This represents a staggering 76% decrease from the peak of early summer's fervor. Consequently, shares in these treasury firms, many of which previously raised capital through Private Investment in Public Equity (PIPE) deals, have experienced severe valuation plunges. Some are now trading as much as 97% below their initial issuance prices, with the market-cap-to-Net Asset Value (NAV) multiple reflecting a narrowing disconnect between stock prices and their underlying Bitcoin reserves.
Institutional Retreat and Market Volatility
Beyond individual firm valuations, the broader cryptocurrency market is grappling with a "feedback loop" of diminishing institutional support. Bitcoin itself recorded a nearly 6% decline last week, exacerbated by sudden liquidations in derivative markets, where approximately $275 million worth of Bitcoin long positions were liquidated in just 24 hours. This stress is particularly visible in longer-dated futures, which have seen demand collapse. Regulatory scrutiny is a major contributing factor, with US authorities reportedly investigating "unusual trading activities" in digital-asset treasury shares. Markus Thielen of 10x Research points to limited transparency surrounding crypto acquisition prices and actual share counts, especially in PIPE deals complicated by warrants, which introduce additional volatility and dilution risks. In contrast, crypto-related products like the iShares Bitcoin Trust ETF have bucked the trend, attracting $2.5 billion in inflows during September, a substantial increase from the prior month's $707 million. Jeff Dorman of Arca posits that the current market weakness is less about direct selling pressure and more a consequence of reduced buying activity from major digital asset treasuries, fostering a more cautious overall environment.
