Ethereum Holdings Liquidated for Share Repurchases
Digital asset treasury company FG Nexus has sold 10,922 Ethereum, worth approximately $33 million at current prices, to finance a share repurchase program. The firm combined crypto sale proceeds with $10 million in borrowed funds to buy back 3.4 million shares, representing roughly 8% of outstanding float at an average price of $3.45.
The buyback price sits substantially below reported net asset value of $3.94 per share. FG Nexus now holds around 40,000 Ethereum plus $37 million in cash and USDC stablecoin, according to the company's update. The move highlights mounting pressure on digital asset treasury firms, many trading at levels far below the net asset value of underlying crypto holdings.
Industry Trends and Valuation Gaps
Fellow Ethereum treasury firm ETHZilla sold approximately $40 million in tokens last month to fund share repurchases. Share buyback programs offer one approach to close valuation gaps, but raise questions about sustainability while liquidating core assets.
Chairman and CEO Kyle Cerminara stated the company plans to continue repurchasing shares while stock trades below NAV, creating an increasingly asymptotic effect on per-share valuation metrics as outstanding shares decline and net asset value per share increases. FGNX shares rose 2% in early Thursday trading but remain down over 95% from last summer's peak.
Market Reaction to Treasury Liquidations
The announcement pressured crypto prices, with Ethereum sliding roughly 2% before a modest recovery. Bitcoin dipped about 1% before clawing back losses. The immediate market reaction illustrates the impact when treasury firms liquidate holdings to support equity valuations.
FG Nexus's Previous Growth Strategy
FG Nexus, previously Fundamental Global Inc., filed a $5 billion shelf registration statement with the Securities and Exchange Commission in August. The company planned to raise up to $5 billion to purchase Ethereum and become the world's largest corporate Ethereum holder.
Challenges in the Digital Asset Treasury Space
Many investors stated last month that the wave of digital asset treasury funding rounds had peaked. Comments came as numerous treasury firms began trading at or below net asset value. Market observers suggest the treasury space faces substantial consolidation ahead.
Bitmine Immersion Tech holds the title of world's largest Ethereum treasury, with over 3 million Ethereum. The continuing difficulties for digital asset treasury companies have fully materialized as firms, after stock declines ranging from 50% to 98%, trade at levels far below their crypto balance sheet values and resort to selling the very assets they were created to hold. The pattern raises fundamental questions about the treasury model's viability when equity markets refuse to assign value to underlying cryptocurrency holdings.