Business
Crypto treasuries pivot to fringe tokens as bitcoin cools | The Express Tribune
Treasury firms chase lesser-known coins for returns, triggering warnings over instability
As companies focused on stockpiling bitcoin and other major cryptocurrencies come under pressure amid market saturation and souring sentiment, new entrants are pushing into less popular tokens, stoking worries over increased volatility.
Buoyed by US President Donald Trump’s crypto-friendly stance and inspired by the meteoric success of Michael Saylor’s Strategy, the number of publicly-traded companies investing in cryptocurrencies in the hopes they will appreciate has boomed.
As of September, there were at least 200 digital asset treasury, or DAT, companies – mostly focused on bitcoin – with a combined capitalization of around $150 billion, up over threefold from a year earlier, according to an analysis by law firm DLA Piper.
More companies, many of them penny stocks seeking ways to boost profits, are launching daily. But as bitcoin sags, they are turning to esoteric, more volatile tokens in a bid to amplify returns, according to a Reuters analysis of more than three dozen company announcements.
Risk ahead for investors?
In recent weeks, for example, Greenlane, OceanPal, and Tharimmune, announced plans to stockpile BERA, NEAR and Canton Coin, respectively.
The trend illustrates how the often-volatile and speculative world of cryptocurrencies is becoming more entwined with traditional markets, creating potential hazards for investors.
“DATs are expanding towards more exotic and less liquid cryptocurrencies, and that’s exactly where the risk could be much higher,” said Cristiano Ventricelli, vice president and senior analyst of digital assets at Moody’s Ratings.
“When markets drop, there is more pressure on the equity of these companies,” Ventricelli added.
A volatility pipeline
Since April, many DATs have funded token purchases via private placements or PIPEs – selling shares directly to private investors – usually at a discount.
At least 40 DATs raised more than $15 billion combined via PIPEs between April and November, only five of which were focused on bitcoin, Reuters’ analysis found. Bitcoin registered a monthly loss in October for the first time since 2018.
Heavyweight crypto investors in these deals include Winklevoss Capital, Galaxy Digital, Jump Crypto, Pantera Capital, Kraken and DWF Labs, public data shows.
While some institutional investors can buy tokens directly, DATs offer the chance to leverage returns and let more cautious investors gain crypto exposure through regulated public firms.
PIPEs allow companies to quickly access cash, but shareholder dilution and the potential resale of shares when lockup periods end often stoke stock price volatility. And because many DAT companies are so reliant on PIPEs, they are especially vulnerable when markets fall, say analysts.
That was evident on October 10 when markets slumped on renewed US-China tariff tension. BitMine, which stockpiles ether, fell more than 11% and Forward Industries, which invests in Solana, fell more than 15%. Strategy, which has funded purchases through other means, fell nearly 5%.
“The hype has deflated since when the DATs first came to the market. But I think it could come back,” said Peter Chung, research head of crypto-focused Presto Research.
An OceanPal spokesperson said its NEAR purchases offered shareholders a way to benefit from the token’s integrated AI capabilities. Greenlane declined to comment.
Strategy, BitMine, Tharimmune, Winklevoss Capital, Galaxy Digital, Jump Crypto, Pantera Capital, Kraken and DWF Labs did not immediately respond to requests for comment.
Trading below net asset value
Many DAT companies earlier this year traded at a premium to their crypto holdings because investors believed they could use their access to credit to purchase more tokens.
But as bitcoin has flagged and Strategy copycats flooded the market, some are wobbling. At least 15 bitcoin treasury companies were trading below the net asset value of their tokens as of Friday, according to data from crypto publication The Block.
Retail investors, who are big buyers of Strategy and other high-profile bitcoin DATs, lost around $17 billion on these trades, Singapore firm 10x Research estimated last month, Bloomberg reported.
Some DATs focused on other large coins are also under pressure. ETHZilla and Forward Industries recently approved share repurchases, a move typically aimed at propping up share prices.
“I think most of these digital asset treasury companies will wind up trading at a discount to the digital asset,” said Michael O’Rourke, chief market strategist at JonesTrading.
‘Absolutely decimated’
DAT companies hold 4% of all bitcoin, 3.1% of all ether and 0.8% of all solana, meaning their fortunes could have major implications for coin prices, Standard Chartered analysts wrote in a September note, adding they expected consolidation in the space.
Kyle Samani, chairman of Forward Industries, said in a statement that the company’s buyback provides “flexibility to return capital to shareholders when we believe our stock trades below intrinsic value.”
He and other DAT executives say their success will be rooted in their ability to make smart investing decisions.
“You’re betting on the management team to go do interesting things, and that’s what we’re trying to do,” Samani, who is also co-founder of Multicoin Capital, which invested in Forward Industries’ September PIPE, said in an interview.
An ETHZilla spokesperson said the company was opportunistically repurchasing shares while its stock traded below net asset value, and that while it holds a lot of ether, it is mostly focused on putting traditional assets onto the blockchain.
Likewise, other DAT companies are looking for new ways to boost shareholder value. SUI Group, which stockpiles Sui, recently launched its own stablecoins, said Chairman Marius Barnett.
If a DAT just sits back and only buys tokens, “long term, you’re going to get absolutely decimated,” he added.
Business
Oil nears highest price since start of Iran war
The US-Israel Iran war has halted almost all traffic in a key waterway and the price Brent crude has surged.
Source link
Business
Crunch talks between resident doctors and ministers set to continue
Crunch talks between resident doctors and the Government are set to continue in a bid to avert strike action.
Sir Keir Starmer has given the resident doctors committee of the British Medical Association (BMA) a deadline to reconsider a deal on pay and jobs which includes an offer of thousands of extra NHS training posts.
It is understood the proposal will be removed from the deal if resident doctors in England press ahead with a six-day strike from April 7 in a row over jobs and pay.
Dr Jack Fletcher, chairman of the resident doctors committee of the union, said: “It is wrong for Government to withhold desperately-needed jobs as part of negotiating tactics.
“Anyone who works in the NHS knows that patients need these 4,000 jobs created as soon as possible.
“We made that very clear to Government in our meetings today.
“We are not interested in arbitrary deadlines – we will be looking to get this dispute ended right up to the last minute.
“We believe there is a deal there to be done if Government is willing to withdraw the changes it made at the last minute that reduced the funding for pay rises. Talks continue.”
It comes as senior medics announced they were escalating their disputes with the Government.
Consultants and other senior doctors are to be balloted on industrial action after ministers announced they would be getting a 3.5% pay award.
Simultaneous ballots of consultants and specialist, associate specialist and specialty (SAS) doctors will run from May 11 until July 6.
Addressing resident doctors, Prime Minister Sir Keir Starmer wrote in The Times: “The truth is this: no-one benefits from rejecting this deal.
“Resident doctors will be worse off. Instead of improved pay, progression and support, they will receive the standard pay award this year, with none of the reforms that would have strengthened their working lives.”
The deal sets out a minimum of 4,000 new additional specialty posts to be delivered over the next three years.
NHS England boss Sir Jim Mackey confirmed the offer to expand training places will “come off the table” if an agreement is not reached.
The walkout, which is due to run from 7am on April 7 until 6.59am on April 13, will be the 15th round of strikes by resident doctors in England since 2023.
In a letter to health leaders, Mike Prentice, national director for emergency planning at NHS England, wrote: “We expect this round to be challenging as there is a shorter notice period, bank holidays within the notice period and the action itself falling during the Easter holidays.
“This will represent a significant strain on staffing resources to provide safe cover.”
Business
Iran oil returns: India set to receive first cargo in 5 years, tanker heads to Gujarat – The Times of India
India is set to receive its first shipment of Iranian crude oil since 2019, with a tanker carrying 600,000 barrels of oil en route to Gujarat following a temporary sanctions waiver by the US, according to PTI.Ship-tracking data indicates that the vessel Ping Shun is headed towards Vadinar port, marking a potential revival of Indo-Iran oil trade after nearly five years.“The Indo-Iranian oil trade has flickered back to life. Following the US administration’s decision to grant a 30-day window for Iranian oil “on the water” due to regional conflict, the vessel Ping Shun is now en route to Vadinar (in Gujarat) with 600,000 barrels of crude. This is the first such delivery since May 2019 and comes at a critical time for Indian refiners facing tightening inventories,” said Sumit Ritolia, Lead Research Analyst, Refining and Modelling at Kpler.The development follows Washington’s decision earlier this month to allow a 30-day window for the purchase of Iranian oil already at sea, aimed at easing global oil prices amid the ongoing US-Israel conflict with Iran. The window is set to expire on April 19.While the buyer of the cargo remains unidentified, Vadinar houses a 20 million tonnes per annum refinery operated by Rosneft-backed Nayara Energy and also serves as a landing point for crude supplies to inland refineries such as BPCL’s Bina unit.India’s oil ministry has so far maintained that any decision to resume imports from Iran will depend on techno-commercial viability.Before sanctions were tightened in 2018, India was among the largest buyers of Iranian crude, importing both Iran Light and Iran Heavy grades due to refinery compatibility and favourable pricing terms.Imports ceased in May 2019 after US sanctions were reimposed, with India shifting to alternative suppliers including the Middle East and the US. At its peak, Iranian crude accounted for 11.5 per cent of India’s total imports.India had imported about 518,000 barrels per day (bpd) of Iranian oil in 2018, which declined to 268,000 bpd between January and May 2019 during a sanctions waiver period before dropping to zero thereafter.“The Aframax Ping Shun (IMO 9231901) loaded with Iranian crude oil from Kharg Island in early March has emerged as the first vessel observed signalling a destination of Vadinar, India since May 2019, following sanction reimposition on Iranian oil by the first Trump administration,” Ritolia said.The tanker is estimated to have loaded around 600,000 barrels from Kharg Island around March 4 and is expected to reach Vadinar on April 4.An estimated 95 million barrels of Iranian oil are currently stored on vessels at sea, of which around 51 million barrels could be supplied to India, while the rest may be directed to China and Southeast Asian markets.However, payment mechanisms remain uncertain as Iran continues to be excluded from the SWIFT global banking system, complicating international transactions.Earlier, payments were routed in euros through Turkish banks, but that channel is no longer available following renewed sanctions restrictions.Iran was first disconnected from SWIFT in 2012 due to EU sanctions over its nuclear programme, with further disruptions in 2018 after the US reimposed sanctions, limiting its ability to receive payments and access foreign currency reserves.
-
Politics1 week agoAfghanistan announces release of detained US citizen
-
Sports1 week agoBroadcast industry CEO says consolidation is ‘essential’ to compete for NFL soaring media rights prices
-
Tech1 week agoCan a Home Appliance Fix the Problem of Soft-Plastic Waste?
-
Entertainment1 week agoUN warns migratory freshwater fish numbers are spiralling
-
Business1 week agoProperty Play: Home flippers see smallest profits since the Great Recession, real estate data firm says
-
Business1 week agoGold prices soar in Pakistan – SUCH TV
-
Fashion1 week agoICE cotton slips on weaker crude, profit booking
-
Business1 week agoMore women are entering wealth management, but few are in advisory roles, study finds
