🔎The new crypto bubble
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In today’s newsletter:
🔎The new crypto bubble
📊 On-chain alpha
😂 Crypto meme of the week
🗞️ The latest DeFi news
🔎The new crypto bubble
Historically, every bull market gives rise to a new crypto bubble, which brings incredible wealth creation opportunities, but often also has a tragic end.
Last cycle, we had the Terra Luna bubble.
In 2018, we had the ICO bubble.
Until recently, though, we hadn’t seen anything comparable this cycle. But that’s now changing with the emergence of a new wave of crypto treasury companies.
Last week, I covered how treasury companies such as Strategy or SharpLink Gaming that are buying BTC or ETH can have a big positive impact on prices.
In the meantime, even more crypto treasury companies have announced that they will accumulate a wide range of assets:
StablecoinX Inc., which raised $360M to buy $ENA
Nano Labs, which plans to raise $200M to buy $BNB
Upexi, which plans to raise $200M to buy $SOL
Bit Origin, which plans to raise up to $500M to buy $DOGE
Sonnet, which is raising $888M to buy $HYPE
Trump Media bought $2 billion in $BTC for its treasury strategy
And these are just a few examples. It’s funny how TradFi companies went from fudding crypto to buying our bags.
Why are crypto treasury companies a big deal?
As I also briefly explained in last week’s newsletter, these crypto treasury companies can buy huge amounts of crypto because their stock shares trade at a premium to the value of their crypto holdings on the stock market.
This is typically their strategy:
A small public company starts accumulating a specific token
They announce it publicly and create a lot of hype
The stock of that company pumps beyond the actual value of their crypto holdings (in most cases)
Thanks to that stock premium, they can raise new capital via ATM sales (which means they sell newly issued shares at the current market price)
That capital is then used to buy even more crypto - and the loop continues
This can enable them to buy crypto tokens worth billions of dollars. You can imagine how this could create huge buying pressure.
How to capitalise on this new meta?
My plan is to closely monitor which tokens are being regularly accumulated in large amounts by treasury companies over the next weeks, and invest in them too.
So far, the only two tokens with constant demand are BTC and ETH.
SharpLink Gaming filed to raise $5 billion to buy more ETH just a few days ago.
I believe this is just the beginning of the treasury company bubble. We will probably see HUNDREDS of public companies buying our bags over the next months.
Is this sustainable in the long term?
I doubt it, as treasury companies can keep buying tokens only as long as their stock shares continue to trade at a premium.
But I think we’re still in the early stages of the crypto treasury company bubble.
In the short to mid-term, these treasury companies could push the valuations of many tokens to insane levels.
Until recently, treasury companies were buying only BTC.
This might be one of the reasons why BTC performed so well in the past years. Now, billions of dollars are starting to flow into select altcoins as well.
If my thesis is correct, I think the 2nd half of 2025 (mainly Q4) will be great for those who didn’t leave crypto and are still bullish on this industry.
Yet don’t be surprised if we see some dips in the short term, as ETH, for instance, is already up 50% in the past 4 weeks without any big corrections.
Have some patience and conviction. It will pay off big time.
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On-chain Alpha🔎
40% of the Ethereum ETFs’ net flows came in just 8 days
Crypto Meme😂
The latest developments in DeFi
SEC Chair said ETH isn’t a security
SBET filed to buy $5 billion more ETH
Fluid introduced Fluid DEX Lite - the most gas-efficient DEX on Ethereum
Base L2 activated the Flashblocks upgrade, which makes it 10x faster
Silo Finance launched a new PT-tETH market, enabling users to earn up to 28% looped APY on ETH. PT tETH is a fixed yield token from Pendle
Avail launched svmBNB, enabling running Solana programs on the Avail Network. AVAIL is used to pay for the data availability services on Avail DA
StablecoinX raised $360 million to buy Ethena’s ENA token
Lombard Finance revealed its roadmap, which includes launching new tokenized products and building a cross-chain BTC
Kaito introduced gKAITO - a new mechanism that will enable earning a share of the platform fees and getting access to exclusive deals
Sonic’s S1 Airdrop is now available for claiming. Only 25% of the S airdrop is claimable at this moment
Ether Machine, the first public company built to actively use ETH in DeFi with $1.5B in committed capital, was introduced
Defi App’s buyback proposal has passed. 80% of protocol revenue will go to $HOME buybacks
Trump signed the pro-stablecoin Genius bill into law
PayPal announced the expansion of its stablecoin to Arbitrum
Jito Labs introduced BAM - a system that aims to improve transaction sequencing and reduce MEV on Solana
Euler Labs introduced Euler-powered credit cards, enabling users to make real-world payments without selling their collateral
That’s all for this week!
Until next time,
The DeFi Investor
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