Corporate digital asset activity remained muted week over week amid fallout from the latest crypto deleveraging, with Wall Street broker B. Riley noting that capital flows were beginning to normalize as US-China trade talks progressed.
Earlier this month, the brokerage initiated coverage on digital asset treasury companies (DATCOs) BitMine Immersion Technologies (BMNR), SharpLink Gaming (SBET), FG Nexus (FGNX), Kindly MD (NAKA), and Sequans Communications (SQNS), assigning each a Buy rating.
“Despite market weakness, DATCOs continued to accumulate crypto,” analysts Fedor Shabalin and Nick Giles wrote in Wednesday’s report.
BitMine Immersion led peers and added about $300 million in ether and to raise its concentration ratio to 10.6 ETH per 1,000 shares compared to the group average of 3.9x among ETH-focused companies, the analysts wrote.
Across the 25 companies the broker tracks, the median market net asset value (NAV) improved to 1.1x from 1.0x, while the average held steady at 1.0x.
B. Riley expects firms trading below NAV to initiate share buybacks to narrow valuation gaps, citing ETHZilla’s ( ETHZ ) success in monetizing crypto holdings to buy back shares.
The broker said this strategy is particularly relevant for Sequans Communications, which trades at the steepest discount in the group at 0.7x NAV and reports third-quarter results on November 4 before the market opens.
In a notable development for institutional crypto adoption, solana saw the debut of its first spot exchange-traded funds (ETFs) in Hong Kong and the US, drawing $800 million in first-day inflows, the report noted.
B. Riley said the introduction strengthens Solana’s status as a tier-1 asset alongside bitcoin and ether.
The firm’s analysts continue to see BitMine Immersion as the best-placed name within its DATCO coverage, while noting a quiet week for its other top pick, SharpLink Gaming, with no major catalysts.
Read more: Crypto Treasury Firms Keep Buying Bitcoin. Outperforming ETFs is the hard part
