Conversations about Bitcoin price drops should focus more on the role of crypto treasury companies, argues Omid Malekan, a blockchain author and adjunct professor at Columbia Business School.
In a post on X on Tuesday, Malekan said that digital asset treasuries (DATs) have significantly contributed to the market’s ongoing decline. "Any analysis of why crypto prices continue to fall needs to include DATs," he wrote. "In aggregate they turned out to be a mass extraction and exit event, a reason for prices to go down."
Malekan suggested that while a few companies in the space have tried to "create sustainable value," most have focused on short-term profit. "I can count them on one hand," he added.
Bitcoin has traded to $113,560 over the past week, falling from its October 6 all-time high of over $126,000, according to CoinGecko. While analysts have largely attributed the decline to macroeconomic pressures and U.S.–China trade tensions, Malekan argues that internal industry dynamics are also playing a role.
Treasury Firms Under Scrutiny as Bitcoin Slides
Malekan noted that many crypto treasury companies have raised millions through public offerings, SPACs, and private placements, but at a high cost. "Launching any kind of public entity is expensive," he said. "The money required for the shell, PIPE, or SPAC runs into the millions — as do the fees paid to bankers and lawyers. The money spent on those fees had to come from somewhere."
These companies often used leverage, borrowing against their assets or issuing convertible notes to acquire more crypto. That strategy, Malekan warned, increases the risk of forced selling during downturns. Some firms have also sought to generate yield through staking and lending, exposing them to further liquidity risks.
Malekan said the most significant damage came from the way digital asset treasuries unlocked and sold large quantities of tokens that were previously considered "locked." "The biggest damage DATs did to aggregate crypto market cap was by providing a mass exit event for supposedly locked tokens," he said. "I’m still amazed so many investors didn’t cry foul."
He added that raising too much money and minting too many tokens, even if they are locked or for ecosystem growth, is the gangrene of crypto.
Crypto Treasury Boom in 2025
The crypto treasury trend has exploded this year. A Bitwise report in October found that 48 new companies added Bitcoin to their balance sheets in 2025. This brings the total to 207 firms holding over one million BTC, worth more than $101 billion.
Similarly, data from Strategic ETH Reserve shows that 70 companies now hold 6.14 million Ether, valued at over $20 billion. Analysts expect the sector to consolidate as larger firms absorb smaller players and look for new ways to attract investors. Others foresee an expansion into broader Web3 initiatives.