Unchained Bitcoin Treasury Companies Are Taking Off. Could They Eventually Crash? - Ep. 843
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May 30, 2025 Cosmo Jiang, General Partner and Portfolio Manager for Liquid Strategies at Pantera Capital, delves into the rising trend of crypto treasury companies. He discusses why firms are flocking to these structures for crypto exposure and the implications of high-profile investments like Trump Media’s massive Bitcoin purchase. Jiang also explores the growing popularity of Solana over Ethereum and the unique challenges faced by treasury companies, raising questions about their safety and the risks they pose to investors.
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Rise of Crypto Treasury Companies
- Crypto treasury companies are surging due to historical success and strong equity market appetite.
- Regulatory clarity and investor demand fuel this rapid growth trend in crypto exposure vehicles.
Structures of Treasury Companies
- These companies primarily use SPAC mergers or public shell companies to access capital markets.
- Raising capital occurs via PIPE equity or convertible debt, each with distinct risk-reward profiles.
Choose Investment Type Carefully
- Understand that PIPE investments offer full equity risk and reward, while convertible notes offer downside protection but capped upside.
- Choose investment type based on your risk tolerance and existing crypto exposure.