Corporate digital asset activity remained subdued week over week due to fallout from recent crypto deleveraging, with Wall Street broker B. Riley noting that capital flows have begun to normalize as trade negotiations between the United States and China progress.
Earlier this month, the broker initiated coverage of digital asset treasury companies (DATCO) BitMine Immersion Technologies (BMNR), SharpLink Gaming (SBET), FG Nexus (FGNX), Kindly MD (NAKA), and Sequans Communications (SQNS), giving each a Buy rating.
“Despite market weakness, DATCOs continued to accumulate cryptocurrencies,” analysts Fedor Shabalin and Nick Giles wrote in Wednesday’s report.
BitMine Immersion dominated its peers, adding around $300 million in ether and increasing 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.
Of the 25 companies tracked by the broker, the market median net asset value (NAV) improved from 1.0x to 1.1x, while the average remained stable at 1.0x.
B. Riley expects companies trading below NAV to start buying back shares 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 of the group, at 0.7x net asset value, and reports its third quarter results on November 4 before the market opens.
In a notable development for institutional crypto adoption, solana saw the launch of its first spot exchange-traded funds (ETFs) in Hong Kong and the United States, attracting $800 million in inflows on the first day, the report noted.
B. Riley said the introduction reinforces Solana’s status as a tier-one asset alongside Bitcoin. and ether.
The company’s analysts continue to view BitMine Immersion as the top-ranked name in its DATCO coverage, while noting a quiet week for its other top pick, SharpLink Gaming, without a major catalyst.
Learn more: Crypto cash companies continue to buy Bitcoin. Outperforming ETFs is the hard part
