Companies Pivot to Crypto as Bitcoin and Ethereum Surge

An increasing number of publicly traded companies are incorporating digital assets into their corporate treasuries, reflecting a growing interest in cryptocurrencies as their prices surge. This trend, inspired by the strategy of software firm Strategy, which began adding Bitcoin to its balance sheet in 2020, has led to some unconventional pivots.

Among the firms embracing this trend are those with diverse and sometimes unexpected business models. For instance, DDC Enterprise, a Hong Kong-based food giant, recently closed a $528 million raise to build out its Bitcoin treasury. The company, known for its Asian-inspired food brands like Yai’s Thai and Nona Lim, as well as the recipe-sharing platform DayDayCook, held 368 BTC as of early July. This pivot is notable as the company has rebranded itself with "Decentralize Digital Capital" on its LinkedIn page, marking a significant shift from its food-focused origins.

Another intriguing example is Dogecoin Cash Inc., formerly known as Cannabis Sativia. This Canadian company, which operates in the cannabis industry and holds patents for high-potency cannabis products and telemedicine services, has amassed millions of dollars worth of Dogecoin Cash. The firm also plans to maintain a Dogecoin treasury through a wholly owned subsidiary, further aligning with the Strategy-inspired playbook. As of June 13, the company held 2,020,000,000 Dogecoin Cash, valued at $3.5 million.

Metaplanet, often referred to as the "Strategy of Japan," has a unique business model that includes managing budget hotels, including "love hotels," across Japan. Despite its unconventional business, Metaplanet has become a strong advocate of the Strategy model, holding 15,555 Bitcoin worth $1.84 billion based on current prices.

Solar Bank, a renewable energy developer, has also made a surprising pivot by committing to add Bitcoin to its balance sheet. Despite concerns about Bitcoin's energy consumption, Solar Bank aims to use the tokens to establish a Bitcoin treasury, although the exact number of tokens it plans to acquire has not been disclosed.

SharpLink Gaming, a gambling marketing firm based in Minneapolis, has taken a significant risk by acquiring more than $400 million worth of Ethereum, making it the largest holder of the token among publicly traded firms. As of the latest updates, the firm holds about $644 million worth of ETH, including $30 million purchased directly from the Ethereum Foundation. Founded in 2019, SharpLink uses AI-powered tools to match sports betting companies with fans, directing them to relevant betting content.

While these companies have embraced cryptocurrencies, experts caution that adding crypto to a balance sheet does not necessarily salvage a poorly run business. Andrew Bailey, senior fellow at the Bitcoin Policy Institute, noted that "Most new ‘treasury companies’ are gimmicks, and will likely fail. A badly run business doesn’t become a good one just because it is acquiring sound money." Despite these warnings, the trend of companies adding digital assets to their treasuries continues to grow, driven by the potential for significant gains and the desire to capture recent market tailwinds.