Companies holding crypto treasuries are experiencing stock price increases due to share buyback programs, suggesting they are vying for greater credibility.
Thumzup, a media company connected to Trump Jr. that holds Bitcoin (BTC) and Dogecoin (DOGE), announced on Wednesday its share buyback would increase from $1 million to $10 million, which propelled its stock (TZUP) up 7% for the day, with an additional 0.82% gain after hours to trade at $4.91.
Meanwhile, DeFi Development Corp (DFDV), a treasury company associated with Solana, increased its buyback from $1 million to $100 million, which resulted in its stock gaining over 5%, before settling for a more than 2% increase and another 1% after hours at $15.50.
This follows a report by Coinbase’s head of research, David Duong, and researcher Colin Basco, predicting on September 10 that publicly traded companies buying crypto are entering a “player vs player” phase to attract more investor funds.
The credibility race in treasury management
Ryan McMillin, chief investment officer of Merkle Tree Capital, an Australian crypto investment firm, told Cointelegraph that these buybacks indicate the crypto treasury competition is evolving into a “credibility race.”
“Simply saying ‘we hold Bitcoin’ is no longer sufficient. Investors now demand professional capital allocation—buybacks, dividends, and clear treasury strategies,” he stated.
“The integration of corporate finance strategies with the digital-asset narrative is significant. It indicates these firms wish to be evaluated not just on their Bitcoin holdings but also on shareholder returns.”
Buybacks signify confidence
However, not every crypto treasury company with buyback commitments has seen positive results. TON Strategy Company, formerly Verb Technology Company, made a similar announcement on September 12, but its stock (TONX) fell by 7.5%.
McMillin noted that share buybacks can serve as a “classic signal of confidence” when a company believes its stock is undervalued. This is important for publicly listed crypto treasury companies, as “their valuations often fluctuate in relation to their Bitcoin holdings (mNAV).”
“A buyback can help close that valuation gap by reducing float and demonstrating fiscal discipline—which investors tend to reward. Additionally, stock prices may move as traders anticipate increased demand. Greater Bitcoin purchases heighten exposure to volatility,” he explained.
“In contrast, a buyback directly enhances shareholder value while maintaining the crypto treasury narrative. It broadens appeal among investors—some prefer the Bitcoin story, while others seek capital discipline. A well-timed buyback effectively marries both interests.”
The battle between the dollar and Bitcoin
Kadan Stadelmann, CTO of the blockchain-based Komodo Platform, told Cointelegraph that shareholder buybacks utilizing cash reserves lead to fewer available shares for the public, creating scarcity and increasing price pressure.
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“Crypto treasury companies are competing to construct the most appealing treasury strategies, amid a trend toward hyperbitcoinization, which reflects a de-dollarization trend—Bitcoin versus the dollar,” he noted.
The persistence of crypto asset treasuries
Bitbo is monitoring firms that have included Bitcoin in their assets, holding over 1.4 million coins, accounting for about 6.6% of the total supply.
Michael Saylor’s company, Strategy, leads with 638,985 Bitcoin and continues making regular acquisitions. Some analysts suggest the market for crypto-buying companies is oversaturated, and not all will endure in the long term.
Stadelmann believes the “trend of crypto asset treasuries” is unlikely to diminish anytime soon, as “more companies will allocate portions of their treasuries to Bitcoin and other crypto assets, including those in the Fortune 500.”
“A key question for investors is which companies will retain their Bitcoin holdings through challenges rather than selling off during market downturns or crisis periods.”
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