Digital asset treasury firms are likely to consolidate under larger entities as the sector evolves, according to David Duong of Coinbase. He noted that amidst strategies to enhance stock prices, companies might seek mergers and acquisitions akin to the recent agreement between Strive and Semler Scientific.

The Delaware-based Strive revealed on September 22 that it is acquiring Semler Scientific in an all-stock deal. At the same time, Duong identified that these firms are turning to more crypto-centric strategies, such as generating yields through staking and DeFi looping—borrowing and reallocating the same asset to maximize returns.

“And there’s still a lot more they can do here. I think the future will depend a lot on what happens with regulatory shifts, liquidity and market pressures to get a clearer sense of where this could all go long-term.” (Translation: “Y aún hay mucho más que pueden hacer aquí. Creo que el futuro dependerá mucho de lo que suceda con los cambios regulatorios, la liquidez y las presiones del mercado para obtener una idea más clara de hacia dónde podría ir esto a largo plazo.”)

In a previous statement, Standard Chartered predicted on September 15 that not all digital asset treasuries will endure long-term survival, possibly pushing them towards novel strategies or fading away. Duong, alongside fellow Coinbase researcher Colin Basco, indicated in a September 10 report that the competition among DATs has transitioned into a player-versus-player phase.

Coinbase has recently noticed share buybacks from crypto treasury entities as part of this competitive stage. Duong voiced that these moves may stem from the belief that only a few main players will dominate each token, leading companies to differentiate themselves through scale or financial innovation.

“I believe where this is coming from is that companies are under the impression that only a handful of major players will dominate each token, and they are competing to differentiate themselves through either size or financial engineering.” (Translation: “Creo que esto proviene de la impresión de que solo un puñado de jugadores importantes dominarán cada token, y compiten por diferenciarse a través del tamaño o la ingeniería financiera.”)

However, some DATs have faced challenges maintaining share prices due to market saturation and investor apprehensions regarding sustainability. Duong cautioned that share buybacks may not necessarily result in boosting stock prices, especially if viewed negatively by the market.

“The effectiveness of buybacks hinges on investors’ perceptions of a company’s underlying fundamentals.” (Translation: “La efectividad de las recompras depende de las percepciones de los inversores sobre los fundamentos subyacentes de una empresa.”)

Lastly, Digital Asset Treasuries have amassed substantial bitcoin reserves, totaling over 1.4 million coins, or roughly 6.6% of the overall supply—valued at over $166 billion. Additionally, 68 firms have collectively acquired 5.49 million Ether and nine entities have garnered over 13.4 million Solana tokens.