Altcoin Treasury Stocks Are All the Rage Lately. Here’s What Investors Need to Know.

Hoarding is a vice—unless it involves cryptocurrency. Then, it’s a hot business strategy.

There’s money to be made buying up all kind of crypto these days. Eightco Holding (ORBS), Bitmine Immersion Technologies (BMNR), and Sharplink Gaming (SBET) have all announced plans to become crypto treasuries—companies that buy up coins for their balance sheets—and seen their stocks surge in response.

Their shares have outpaced bitcoin and stocks linked to it, in some cases climbing 500% or more year-to-date. A revival in bitcoin alternatives, or altcoins, which fall in and out of favor over crypto cycles, could make these companies not just trendy climbers but also stock proxies for the assets they hold, further legitimizing those coins.

They are part of a new wave of crypto assets—from high-profile IPOs, ETFs holding memes like dogecoin, and freshly unlocked tokens— that are flying towards the markets and at times flying upward once they hit them.

Investors Seek Exposure to a Range of New Assets

Michael Saylor’s Strategy (MSTR), which got the news last week that it wouldn’t be included in the S&P 500 index, is the best-known example of a company turned crypto treasury. A handful of companies now want to do the same thing for assets ranging from number-two cryptocurrency ether (ETHUSD) to worldcoin (WLDUSD) and Trump family-linked coins like World Liberty Financial’s token (WLFIUSD).

Traders are ‘buying these vehicles as plays on the price and attention momentum or a way to get exposure to crypto that doesn’t have an ETF yet,” Tom Bruni, head of markets and investor insights at StockTwits, told Investopedia recently.

What’s next for altcoin treasury stocks remains an open question, though at least one crypto market indicator has been flashing in favor of altcoins, which could help their stock treasuries.

Bitcoin dominance, which measures bitcoin’s market cap as a percentage of the entire crypto universe, has fallen from 65% in late June to around 56% recently, according to CoinGecko. Ether gained to around 13% from around 9% in that time, while other non-stablecoins have as a group climbed to 24% from 19%.

A Bid to Build a ‘Tower of Ether’

Eightco stock recently got supercharged after the company said that it was raising funds to become a treasury for worldcoin, the token tied to the Sam Altman venture aimed at creating biometrics-based digital identities. It also said Wall Street tech analyst Dan Ives would be its new chairman.

Bitcoin miner Bitmine and sports betting company SharpLink Gaming are lining up behind ether. The former, which tapped Fundstrat chief Tom Lee as chairman, aims to build a “tower of ether” and acquire 5% of the total supply. Though ether supply isn’t fixed, it’s at roughly 121 million recently, according to etherscan.

A pending special purpose acquisition company deal with Dynamix could produce a company called The Ether Machine, another treasury company for ether. The July announced merger is expected to close in the fourth quarter, after which the company will list on the Nasdaq under the symbol “ETHM.”

There are about 70 ether treasury companies, according to the tracking site strategicethreserve.xyz, with Bitmine, SharpLink and the Ether Machine the largest; the list is dominated by crypto projects, rather than publicly traded companies.