Author: Fairy, ChainCatcher
Editor: TB, ChainCatcher
"Buying crypto" has become a cheap and quick method of market value manipulation in the stock market.
The US stock market's "copycat season" is surging, with companies' main businesses becoming a backdrop, and digital assets turning into a new market value engine.
But the problem is becoming increasingly sharp: Will the market continue to buy into this valuation game disguised as crypto investment?
Valuation Logic: How Does Buying Crypto Affect Corporate Value?
"Buying crypto" seems like a valuation shift experiment woven from emotions, liquidity, and narrative.
In traditional valuation frameworks, corporate market value stems from comprehensive pricing of core variables like profitability, asset-liability structure, growth potential, and free cash flow. However, in this "crypto buying wave", companies' "financial asset allocation" of crypto assets has leveraged market revaluation.
When enterprises incorporate Bitcoin or other mainstream crypto assets into their balance sheets, market valuation adds a premium multiple based on crypto asset price elasticity and trading expectations. In other words, corporate market value now comes not just from value creation, but also from a leveraged amplification of "potential crypto price increases".
But this structure essentially places "liquidity narrative" above corporate operations, transforming financial allocation into the main axis of capital operations.
Short-Term Boost, Long-Term Uncertainty
Undeniably, entering crypto does have the ability to stimulate stock prices short-term. Take Cango, a car trading service provider, which announced entering Bitcoin mining in November 2023, investing $400 million in 50 EH/s computing power, causing its stock to surge 280%. Similarly, many companies with mediocre main business performance, or even facing financial difficulties, are trying to seek market reevaluation through the "buying crypto" narrative.
We compiled stock price data for listed companies achieving "crypto-stock linkage" through crypto purchases:
From market performance, the phenomenon of "buying crypto equals skyrocketing" has played out multiple times. As long as the "crypto asset" concept is mentioned, short-term funds quickly pour in. However, after short-term surges, many "crypto-holding companies" face stock price corrections, and without continuous crypto purchases or other positive news, gains are hard to maintain.
Therefore, while the "buying crypto" strategy can spark market enthusiasm short-term, whether it can transform into long-term corporate competitiveness and sustained growth remains highly uncertain. The market is also unlikely to truly recognize followers who seek attention through one or two crypto purchases or vague "holding plans".
Are Speculators Starting to Sell?
The story of "buying crypto to boost valuation" continues to ferment, but some core players seem to be quietly taking profits.
MicroStrategy, the proposer of this "infinite growth" theory, has its internal executives continuously selling their stocks. According to SecForm4.Com data, MicroStrategy's internal personnel have entered a concentrated selling period since June 2023. Protos reports that in just the past 90 days, executives have sold stocks totaling $40 million, with selling instances 10 times more than buying.
Image source: secform4.com
Upexi, the "Solana version of MicroStrategy", is also facing pressure after previously raising $100 million to establish a SOL treasury. Yesterday, Upexi plummeted 61.2% as investors registered to sell 43.85 million shares, equivalent to its total circulating shares in early April.
On another front, stablecoin issuer Circle saw its stock price surge to near $300 after listing. However, Ark Invest, which strongly supported it before its listing, has been continuously reducing its holdings. It is reported that Ark Invest has sold Circle stocks four times consecutively, reducing over 36% of its position.
When "buying crypto" becomes a packaging, a market value tool, or even a narrative shell to avoid fundamental questioning, it is destined not to be a "universal key" for all enterprises. Today's market may be willing to pay for "financial allocation", but tomorrow's market might return to genuine inquiries about growth and profitability.
The secondary market's buying may not represent approval; more likely, it's just a rotation of short-term speculative chips.
