According to David Duong, Coinbase’s Head of Investment Research, the Ministry of Digital Assets Treasury will eventually consolidate under a small number of large players as the cycle matures and businesses try to attract investors.
Speaking to Cointelegraph, Duong said outside his strategy to raise stock prices, “As companies approach a more mature stage in the DAT cycle, they could begin pursuing mergers and acquisitions, just like the recent scientific deals of Strive and Semler.”
The asset manager announced on September 22 that the Bitcoin finance company’s efforts were acquiring fellow Dat Semler Scientific in its total stock trading.
At the same time, Dats said that Dats is pursuing a more crypto-native strategy, such as generating yields through staking and definition loops, which involves repeatedly borrowing and relocating the same assets to amplify returns.
“And there’s still so much they can do here. I think the future will depend heavily on what happens with changes in regulations, liquidity, and market pressures, and this will depend heavily on getting a clearer sense of where everything can go in the long run.”
On September 15th, Standard Chartered predicted that not all data would survive in the long term, and forced them to adopt a new strategy or fade out.
Crypto’s finances want to control one token
Duong and Coinbase researcher Colin Basco said in a September 10th report that the DAT race has entered the Player VS Player Phase.
Duon said the recent share buybacks from cryptocurrency companies in the past few weeks were the result of this new phase.
Thumzup, the Trump Jr.-Linked Media Company, which owns Bitcoin (BTC) and Dogecoin (Doge), announced on September 24 that it was increasing its share buybacks from $1 million to $10 million. Solana (Sol) Treasury Company Defi Development Corp has expanded its stock repurchase from $1 million to $100 million.
“I think the impression that the company is that only a few key players control each token, and that they are competing to distinguish themselves through size or financial engineering,” Duon said.
“I think this strategy likely contributed to the negative price action observed in mid- to late September, as these entities were prioritizing their use of capital to raise stock prices over encryption.”
Some data struggled to maintain the stock price, while some data lost up to 90% of its value. This is due to investors’ concerns about market saturation and sustainability.
Stock buybacks are not equivalent to success
Duon also said it was his experience that stock buybacks don’t always lead to price increases. Especially when you recognize behavior as a negative signal about the company’s long-term health, as the market is ultimately “very emotionally driven.”
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“The effectiveness of buybacks depends on investors’ perceptions of the fundamental foundations of a company,” he said.
“For example, if DAT uses buyback as a defensive operation to reduce floats, but market players believe that the company holds an efficient capital allocation strategy and transparent funds, the stock price could potentially make a profit. Conversely, if the appropriate conditions are not met, the opposite is true.”
Ton Strategy Company, formerly known as the verb Technology Company, announced its share buyback on September 12th, but investors did not respond positively, with the stock falling 7.5%.
Data accumulates important holdings
Data with Bitcoin added to the balance sheet accounts for approximately 6.6% of the total supply, holding over 1.4 million coins, exceeding $166 billion.
At the same time, 68 companies have acquired a total of 5.49 million ether, worth more than $24 billion. Meanwhile, Solana is looking at a massive effort, with nine published entities holding more than 13.4 million tokens worth more than $3 billion.
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