Bitcoin treasuries – Real crypto demand or marketing trick?

More and more public companies announce their plans to buy BTC and build a Bitcoin treasury. In some cases, the actual BTC purchases are delayed for months. 

Building corporate Bitcoin treasuries is all the craze, with the trend accelerating in May. New public companies or private entities announce plans to allocate funds to BTC. However, not all plans materialize, and intentions to buy BTC do not always increase real demand. 

The drive for more corporate purchases arrived after BTC once again recovered above $104,000, signaling ongoing greed from all types of buyers, including retail. 

Critical Metals Corp. announced plans to allocate $500M to BTC but has not bought a single coin since January 21, despite the price drop in February and March. The announcement had a short-term effect on the price of CRML shares, but the lack of developments led to a negative trend in the past six months. 

Critical Metals (CRML) had a brief spike in its stock price, followed by a drop as the company did not buy BTC as expected. | Source: Google Finance

Other companies only bought a minimal amount of BTC, as in the case of Al Abraaj Restaurants Group B.S.C. The company added 5 BTC to its balance sheet, with a business otherwise unrelated to crypto. 

Perhaps the most notable example is Gamestop (GME), which combined its own cult potential with the announcement of adding BTC to its balance sheet. The announcement led to a brief spike of GME to $25.40, but the effect was short-lasting. GameStop only has dust holdings of crypto in its known wallets , with no signs yet of buying the dip on BTC.

Bitcoin treasuries expanded in the past week

Public companies use the general momentum of BTC buying to attract attention to their brand. Some companies are actually quietly buying, with six new holders adding BTC to their balance sheets in the past week. 

Some of the biggest pledges of the past weeks include the Chinese company Addentax group. The company’s shares still traded at $0.58, as the BTC buying did not have the same effect on the stock price. 

DDC Enterprise Ltd. also announced upcoming purchases of BTC. The plan is to acquire up to 5,000 BTC with a 36-month horizon, which may change the appeal of BTC depending on the stage of the market cycle. 

Eric Trump’s American Bitcoin also announced plans to acquire up to 8,000 coins, though the project may at first rely on Hut8 mining for its reserves. 

In total, BTC treasuries amount to 3.32M coins, more than doubled since the levels of Q1 2024. The newest additions came from Next Technology Holding, Inc., Virtu Financial, Horizon Kinetics Holding Corp., ATAI Live Sciences, and Investview. 

One of the problems for corporate treasuries is that not all can follow the model of Strategy (MSTR) and have a feedback loop between their stock price and BTC.

For most companies, the BTC per share will remain a small addition of value, not creating a buying frenzy. MSTR also had the first-mover advantage and has been adopted widely as a proxy exposure to cryptocurrency. Only a few other companies have access to debt or stock sales to finance additional BTC purchases.

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