Shares in the livestreaming and e-commerce company GD Culture Group plummeted 28% on Tuesday following the announcement of a share deal to acquire all assets from Pallas Capital Holding, which includes 7,500 Bitcoin.
GD Culture will issue nearly 39.2 million shares of its common stock in exchange for all of Pallas Capital’s assets, encompassing $875.4 million worth of Bitcoin (BTC), the firm announced on Tuesday. The deal was finalized last Wednesday.
GD Culture’s CEO and chairman, Xiaojian Wang, stated that the deal would “directly support” its initiative to establish a “strong and diversified crypto asset reserve,” benefiting from Bitcoin’s increasing institutional acceptance as a reserve asset and store of value.
The company employs artificial intelligence to generate synthetic personas and operates a livestreaming and e-commerce business via TikTok. This acquisition would position it as the 14th largest publicly listed Bitcoin holder, aligning with the trend of firms accumulating cryptocurrency.
The number of Bitcoin treasury companies has surged in 2025, with over 190 publicly listed firms now holding the asset, a significant increase from fewer than 100 at the beginning of the year. The market has expanded to $112.8 billion, with Michael Saylor’s strategy now holding a 68% market share.
However, momentum has slowed recently, as some investors express concerns that the tactic of acquiring capital, converting it into Bitcoin, and waiting for appreciation may not be viable long-term.
GD Culture stock declines
Shares in GD Culture Group (GDC) dipped 28.16% on Tuesday to $6.99, according to Google Finance data. Shares made a slight recovery in after-hours trading, increasing by 3.7%.
This marked GDC’s largest drop in more than a year, reducing its market cap to $117.4 million. The shares are currently down 97% from their all-time high of $235.80 reached on February 19, 2021.
Diluting company shares typically stimulates negative market reactions due to the reduction of ownership percentages among existing shareholders.
VanEck cautioned on June 16 that companies financing Bitcoin purchases through stock issuance or debt may experience capital erosion if their stock prices fall, as the value of their Bitcoin holdings might not suffice to support new investments without disadvantaging current shareholders.
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“As some of these companies raise capital through large at-the-market (ATM) programs to acquire BTC, a risk is emerging: If the stock trades at or near NAV [net asset value], continued equity issuance can dilute rather than create value,” noted Matthew Sigel, VanEck’s head of digital assets research, at the time.
GD Culture targets Bitcoin, Trump memecoin in May
GD Culture unveiled its crypto treasury strategy in May, announcing plans to sell up to $300 million of its common stock to invest in cryptocurrency, including Bitcoin and President Donald Trump’s Official Trump (TRUMP) token.
The stock offering was disclosed over a month after the firm received a noncompliance warning from Nasdaq regarding its stockholder equity falling below the minimum requirement of $2.5 million.
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