October’s market shock caused the value of assets held by digital asset treasury companies (DATs) to plummet, resulting in widespread losses.
Although some altcoins have recovered, the recovery is still not enough to offset the initial decline, adding further uncertainty to future accumulation strategies. Which DATs are losing money and how are they reacting? The following analysis will give you a clearer picture.
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ETH, SOL, TON, WLFI US Treasuries suffer losses in October
The DAT trend was initially driven by the success of models like MicroStrategy (now renamed Strategy) with Bitcoin. However, the focus has since expanded to include altcoins amid expectations for ETF approval, institutional accumulation, and a decline in Bitcoin’s dominance.
These companies are using their market capitalization to accumulate digital assets, including Bitcoin and altcoins such as ETH, SOL, WLFI, XRP, and BNB.
According to data from CoinGecko, several DATs reported significant losses as of October.
BitMine Immersion (BMNR): On October 13, the company announced that it held 3,032,188 ETH at an average purchase price of $4,154 per ETH. At the time of writing, ETH is trading below $4,000, and BMNR is facing an unrealized loss of nearly 4%. Forward Industries (FORD): This company has the largest Solana (SOL) funding with 6,822,000 SOL, representing 1.248% of total supply. With an average purchase price of $232, FORD’s unrealized loss is more than $245 million, or approximately -15.5%. AlphaTON Capital (ATON): The company accumulated 11.28 million tonnes, representing 0.448% of total supply, and total cost was $30 million. The current value of TON’s holdings is $24.87 million, representing a loss of $5.13 million. ALT5 Sigma (ALTS): The company is also facing losses of nearly $300 million after accumulating more than $1.3 billion in WLFI, which is currently valued at just $1 billion. Other companies such as Bit Origin have lost about $2 million from DOGE’s treasury, and Pineapple Financial has reported a $2.7 million loss on its INJ holdings.
Several companies accumulated XRP in July and August. Also, the price of XRP is lower than it was two months ago, so it could be underwater. However, accurate estimates are still not available as the average purchase price and total holdings have not been made public.
All of these losses are unrealized, meaning DAT can recover if altcoin prices recover soon. However, recent market downturns have made such a scenario increasingly uncertain.
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Potential consequences if DAT faces losses
If the price of an altcoin falls below its average acquisition cost, companies can face serious financial problems.
Assume the market does not recover by the end of the year. In that case, these companies would be forced to record losses in their quarterly financial statements, resulting in lower profits or a net loss.
Many DATs also use debt instruments such as convertible notes and lines of credit to fund their altcoin accumulations. A sharp drop in asset prices can trigger margin calls, forcing you to sell at a reduced price. These sales result in realized losses and deplete liquidity.
Additionally, shareholder confidence may be undermined, leading to a significant decline in stock prices. If the stock price approaches or falls below the company’s net asset value (NAV), management could be forced to liquidate altcoin holdings to pay down debt or fund share buybacks. Such selling could cause altcoin prices to fall further and cause a downward spiral.
Analyst Joe Calasale acknowledged that investors in these financial companies are losing money and called the DAT model not a scam but a failed experiment.
As October progresses, the DAT wave appears to be slowing. Rising macroeconomic concerns and new tariff pressures may cause more companies to hesitate before participating in this trend.
