The digital asset sector (DAT) continues to grow, but according to David Duong, head of investment research at Coinbase, the Crypto Corporate Cash market should gradually be concentrated around a few major players. Many small players may be absorbed or merge, leaving room for a limited number of dominant companies.
In short
- David Duong (Coinbase) believes that small cash companies should merge or be absorbed as the market is consolidated around a few large players.
- These companies are now adopting strategies specific to cryptocurrencies, such as stoking or looping deffi, to improve their yields.
- Ultimately, only a few solid companies could maintain investor confidence and resist market fluctuations.
Cash companies are focusing on strategic acquisitions
This movement, explains Duong, illustrates the way in which companies seek to attract investors. According to him, the maturity phase of the sector will not only be carried by the increase in actions, but also by a wave of mergers and acquisitions. He quotes a recent example: at the end of September, Strive, a former asset manager who has become a Bitcoin cash company, announced the acquisition of sowing scientific in an operation entirely in shares.
For Duong, this type of agreement shows that these companies now incorporate mergers and acquisitions into their growth strategies, rather than relying solely on market performance.
Risk, yields and competition in cash flow assets
In parallel with these structural changes, Duong stresses that cash companies now adopt strategies specific to cryptocurrencies to improve their yields, including Stoking and Looping DEFI. However, he warns that the long -term trajectory of this market will depend on the macroeconomic context.
The regulations, liquidity and market stability will be decisive for the success of these strategies.
In a research note published in September, Duong and Coinbase Colin Basco researcher have erect an inventory of public assets in digital active ingredients. Here are the main figures:
- As of September 10, listed companies holding cryptocurrencies had more than a million bitcoins, for an estimated value of $ 110 billion.
- They also owned 4.9 million ethers, valued for $ 21.3 billion, as well as 8.9 million tokens Solana, representing $ 1.8 billion.
- The authors note that the new entrants take more risks, by allocating part of their capital to more modest altcoins.
The report describes the current environment as a phase “Player against player”marked by an intense competition for visibility. This rivalry, according to them, will continue to focus the majority of capital on the strongest and established cryptocurrencies.
Competition, market pressure and sector consolidation
In his comments at Cointelegraph, Duong observes that many treasury actors start from the principle that a Small number of dominant holders will emerge for each great cryptocurrency. This anticipation pushes companies to accelerate their expansion or to use financial strategies such as buying stock.
According to him, this approach could explain the weakness observed between the Mi and the end of September.
Rather than increasing their reserves of cryptocurrencies, some companies preferred to devote important capital to support their stock market prices, which made them more vulnerable during the slowdown in the market.
The consequences were heavy: several listed companies saw their actions fall by almost 90 %. These tumbles have rekindled fears of market saturation and questioned the viability of certain economic models.
In conclusion, Duong believes that the Crypto cash sector will not be able to support all existing companies. As the crypto market matures, it should consolidate around a few solid players, capable of preserving their scale, the confidence of investors and lasting resilience in the face of changing conditions.
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