The Crypto Treasury company launched this week a move to buy more than $7.8 billion in cryptocurrency, particularly for Altcoins, to grab the cryptocurrency of the largest company in recent history.
Cointelegraph has analyzed 16 company statements since Monday. This has announced plans to purchase or raise cryptocurrency. Ether (ETH) was the hottest target.
At least five public companies are committed to buying or purchasing ETH over $3 billion. That’s about 45 times the amount of ETH issued last week.
So-called cryptocurrency companies are the latest Wall Street trend as traditional financial operators, and often aim to gain exposure to the rapidly growing sector, preventing them from purchasing crypto and related exchange-selling products directly.
ETH’s popularity rises with corporate crypto bets
Bitcoin Miner Btcs Inc. filed on Tuesday plans to sell up to $2 billion in shares to fund future purchases of Ether.
Sharplink Gaming of Jourbin, already the second-largest Ethereum financing company, has further increased the total by purchasing $338 million worth of ETH on Monday and Thursday in two separate purchases.
sauce: Lookonchain
The Ether Machine scooped its assets this week again, buying 15,000 ETH for around $57 million.
Meanwhile, two more ether purchasing companies were born this week. Biotechnology company 180 Life Sciences Corp has been rebranded to Ethzilla Corporation in a $425 million deal, while Merchant Banker has made a $200 million deal with a basic global rebrand to FG Nexus.
Cryptocurrency companies are also getting hot with Altcoins
Cryptocurrency companies were also fascinated by Altcoins this week.
The biggest Altcoin-Buying announcement comes from Tron Inc., the Penny toy company that was taken over by Justin Sun’s Tron blockchain.
Another three signaled plans to buy either Solana (SOL), SUI (SUI) or BNB (BNB).
The most notable financing company this week was CEA Industries, where a Canadian steam company turned BNB into a purchasing company after the acquisitions of investment companies 10X Capital and YZI Labs. The company once described it as the family office of Changpen Zao, the co-founder of Vinanence.
They plan to raise at least $500 million, as they could unlock up to $1.25 billion to buy the BNB reportedly owned primarily by Zhao and Binance.
On Thursday, Tech Company Cemtrex Inc. bought $1 million worth of SoL with the goal of expanding to $10 million, and on Monday lender Mill City Ventures III closed a $450 million deal to pivot into the purchase of SUI.
Crypto-purchases have $100 billion, but not without risk
Galaxy Research Analyst wrote in a report Wednesday that Crypto Treasury Companies collectively owns more than $100 billion in crypto, of which $93 billion is Bitcoin.
Owens said the business model is not without risk, and not all are equally valued as investors apply a “greatly different” equity premium to the company’s net asset value.
For example, Michael Saylor’s strategy had a 58% stake premium, while Owens said Japan’s Metaplanet traded at a 179% premium due to a “active capital formation model.”
sauce: Galaxy Research
He said the business model “relies heavily on NAV’s permanent equity premium. If the premium collapses or even worse, flips it to a discount, the model starts to break down.”
“Treasury companies’ trade is becoming more and more crowded,” Owens said. “When hundreds of companies adopt the same one-way trade (foster equity, buy crypto, repeat), they become structurally vulnerable. One of these three variables, the recession (investment sentiment, crypto prices, capital market liquidity) begins to unravel.”
Strategies help to promote Bitcoin purchases
Bitcoin is a popular option for cryptocurrency companies such as Strategy, with seven companies offering or purchasing a total of $2.7 billion in Bitcoin.
The previous micro-tactics strategy purchased 21,021 Bitcoin after raising $2.5 billion from its fourth preferred stock, STR.
The Smarter web company in the UK also spent around $26.5 million on 225 bitcoin, while Metaplanet bought 780 bitcoin for about $92 million.
One new Bitcoin treasury company was spun up on Tuesday through energy company Zooz Power Ltd., with a $180 million deal planned to buy Bitcoin.