Underperforming Altcoins Impacting Treasury Narrative
David Bailey, the CEO of Bitcoin treasury company Nakamoto, argues that the inclusion of underperforming altcoins in corporate balance sheets is obscuring the overall narrative surrounding treasuries.
In a post on X this Sunday, Bailey stated, “The treasury company moniker itself is confusing.”
He added, “Toxic financing, failed altcoins rebranded as DATs, too many failed companies with no plan or vision. It’s totally muddled the narrative.”
Bailey stressed that “the core strategy is to build and monetize your balance sheet.”
He warned, “If you can do it well, you will grow your assets over time; if you do it poorly, you will trade at a discount and be consumed by someone who can do it better.”
According to Bailey, the entire treasury sector is currently “being tested.” His remarks come as publicly-listed companies begin exploring options beyond Bitcoin (BTC), examining other crypto assets to bolster their treasuries. On August 2, reports indicated that Nasdaq-listed Mill City Ventures III might raise an additional $500 million under an equity agreement to support its newly revealed Sui treasury strategy.
Firms are driven by narrative-based theses to diversify their treasuries beyond Bitcoin, as noted in a report by Galaxy Digital on July 31. Cryptocurrencies such as Ether (ETH), Solana (SOL), XRP (XRP), BNB (BNB), and HyperLiquid (HYPE) are increasingly gaining interest apart from Bitcoin.
As of the time of this publication, Bitcoin held within publicly-traded companies amounts to roughly $117.91 billion, according to BitcoinTreasuries.NET.
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Ether is emerging as a popular alternative as it can also be staked for annual returns, thus serving both as a store of value and a source of income. About 3.14% of Ether’s total supply is currently held by publicly-listed treasury companies, as reported by StrategicETHReserve.
Mike Novogratz, CEO of Galaxy Digital, suggested that the growing interest of treasury companies in the broader crypto market might explain Bitcoin’s recent sideways price movement. “Bitcoin’s at a consolidation right now. Partly because you’re seeing a lot of these treasury companies in other coins take their shot,” Novogratz explained.
While altcoins within treasuries have received some criticism, concerns have also been directed at Bitcoin treasuries. Venture capital firm Breed indicated that only a handful of Bitcoin treasury companies are likely to endure the challenges ahead and avoid facing the harsh “death spiral” that will affect BTC holding companies trading near net asset value (NAV).
