Public Shell Companies’ Aggressive Altcoin Buying Spurs Market Doubts – FT

Altcoin Treasury Moves by Public Firms Raise Concerns Over Speculation

A growing number of public companies are exploring the idea of stockpiling altcoins as a balance sheet strategy — a move that has sparked debate over whether such efforts are sustainable or merely speculative.

Inspired by MicroStrategy’s (MSTR) headline-making bitcoin accumulation strategy, which began in 2020 and helped its stock surge over 3,000%, firms are now considering whether similar crypto-based treasury models can deliver comparable results with other digital assets.

While MSTR currently holds roughly 2.9% of all bitcoin that will ever exist, some companies are now looking beyond BTC and ETH — and into lesser-known altcoins — to replicate the model. However, the Financial Times reported on Friday that many analysts view these efforts as a short-lived trend rather than a viable long-term strategy.

New Treasury Targets: From AVAX to TON

Avalanche’s team is reportedly considering selling a portion of its AVAX tokens to a publicly traded shell company. That entity would then use the tokens to generate yield and attract investors, according to FT sources.

Similarly, Canadian investment firm RSV Capital is aiming to raise $200 million through a shell company that would be used to acquire TON, the native token of The Open Network.

The trend is not without precedent. On July 18, Litecoin co-founder Charlie Lee invested $100 million into MEI Pharma (MEIP), enabling the company to purchase LTC. MEIP shares surged 17% on the news but later retreated, ending the week up roughly 4.9%.

Skepticism Mounts Among Analysts

Despite these early moves, some experts remain unconvinced that smaller altcoins offer the same strategic value as bitcoin.

Eric Benoist, a tech and data analyst at Natixis CIB, called the trend “hugely speculative,” arguing that companies pursuing this model are ultimately exposed to extreme crypto price volatility. “At the end of the day, they’ll be worth whatever crypto they have on the balance sheet — and that’s it,” he said.

Geoff Kendrick, global head of digital assets at Standard Chartered, echoed those concerns, describing the altcoin pivot as “a flash in the pan.” He warned that if prices collapse, companies could face significant losses, potentially hurting both shareholders and bondholders.

Short-Term Hype, Long-Term Uncertainty

While some firms have seen temporary stock gains after announcing altcoin acquisitions, market observers caution that the long-term impact is uncertain. Without strong fundamentals, these treasury strategies may expose public companies to unnecessary risk — particularly in an already volatile digital asset landscape.