Crypto-Hoarding Companies Resort to Share Buybacks to Support Slumping Stocks

 Crypto-Hoarding Companies Resort to Share Buybacks to Support Slumping Stocks

Another story from September 23 involves companies that followed the “crypto treasury” model — holding large allocations of cryptocurrencies — now turning to share buybacks because their stock prices are languishing below the value of the tokens they own. (FT reported this trend in “Crypto hoarders turn to share buybacks…”).

Companies like ETHZilla (formerly known as 180 Life Sciences) are leading the way. For instance, ETHZilla is financing a $250 million buyback plan partly through debt (about $80 million borrowed) to support its stock and signal confidence. Other firms—Empery Digital, CEA Industries—are doing similar moves. These aren’t just cosmetic; in many cases, these companies’ valuations had fallen significantly below the market value of their crypto holdings. Investors were questioning the sustainability of a model that depends heavily on the assets held rather than ongoing cash flow or revenue.

Analysts are divided: some view these buybacks as opportunistic and temporary — a short-term measure to shore up stock prices — while others see them as warning flags: business models that rely mainly on holding crypto may be under pressure. For companies doing this, it will be important to show that their crypto holdings can generate returns, not just serve as passive portfolios.