Analysis of Digital Asset Treasury Strategies and Their Impact on BTC/ETH

The strategy of digital asset treasury (DAT) and its impact on Bitcoin and Ethereum has sparked widespread discussion in the industry. Taking a well-known company as an example, since implementing the Bitcoin strategy in 2020, its stock price has surged from $13 to $455, a staggering increase.

This phenomenon raises a key question: is the significant increase in stock prices due to the rise in cryptocurrency prices, or is it a result of the company's reserve strategy?

In-depth analysis reveals that in the company's stock price increase of 35 times:

• The 11x comes from the price of Bitcoin rising from $11,000 to $118,000.
• The 25 times is attributed to its treasury strategy, which increases the amount of Bitcoin held per share.

Clearly, the treasury strategy has a far greater impact on stock prices than the rise in the token price itself.

The company increases the number of tokens held per share in various ways:

1. When issuing stocks, the price-to-book ratio is greater than 1, thereby increasing the number of tokens per share.
2. Use token price fluctuations to reduce borrowing costs and improve investment returns.
3. Use convertible bonds or preferred shares to limit equity dilution

It is worth noting that Ethereum's volatility is higher than that of Bitcoin, so this volatility may have a more significant impact on Ethereum DAT.

Recently, another company announced its Ethereum treasury strategy and quickly completed the transaction. On the 7th day after the initial transaction was completed, the company had acquired $1 billion worth of Ethereum, compared to $250 million worth of tokens acquired by the former in the same period.

These cases indicate that purchasing tokens can not only increase the total amount of cryptocurrency assets held by the company but also significantly enhance the number of tokens per share, thereby having a positive impact on the company's valuation.

As more and more companies begin to explore digital asset treasury strategies, we may see more innovative financing and asset management methods emerging. This will not only affect the development of individual companies but may also have a profound impact on the entire cryptocurrency market.