"The MicroStrategy Effect" Sweeps Through U.S. Stock Market: 30 Companies Holding Bitcoin as Reserves See Average Stock Price Surge of 400%

Original Title: "30 U.S. Publicly Listed Companies Riding the 'MicroStrategy Effect': Small and Mid-Cap Companies Lead Crypto Reserve Adoption, Stock Prices Spike by an Average of 438%"

Original Author: Nancy, PANews

Following the diminishing effectiveness of traditional crypto practices such as rebranding and token buybacks, a new capital-intensive "crypto-equity" model is emerging as a pivotal narrative engine for crypto projects. From finance to technology, healthcare to entertainment, an increasing number of publicly listed companies are emulating MicroStrategy's playbook—incorporating assets like BTC, ETH, SOL, and TRX into their balance sheets—to embark on a capital game of valuation reconfiguration. This PANews article examines 30 U.S. publicly listed companies that have officially announced crypto reserve strategies.

From Financial Strategy to Valuation Logic: Small and Mid-Cap Firms Replicate the "MicroStrategy Effect"

As a pioneer in the crypto-equity approach, MicroStrategy boldly incorporated Bitcoin into its balance sheet as early as August 2020—a move that was viewed as a radical financial experiment at the time. Fast-forward five years, what was once a niche strategy is now evolving into a mainstream narrative across industries. More and more companies, particularly small and mid-cap publicly listed firms, are integrating crypto assets into their reserve systems, aiming to rebuild their valuation logic through a combination of "crypto reserves + capital market leverage."

Among the 30 U.S. listed companies identified, aside from prominent players in tech and fintech such as MicroStrategy, BTCS, and DeFi Technologies, traditional industries such as healthcare, biopharma, e-commerce, education, new energy vehicles, agricultural trade, and entertainment media are also incorporating crypto assets into their asset allocation frameworks.

These businesses often share common challenges such as sluggish growth in core operations, stagnant valuations, and insufficient liquidity. Companies like SharpLink Gaming, Semler Scientific, Kindly MD, Quantum BioPharma, and Silo Pharma illustrate this trend. In the face of traditional growth bottlenecks, deploying crypto assets serves both as a financial strategy and as a narrative pivot in the capital markets. For instance, SharpLink Gaming, which was on the brink of delisting due to underwhelming performance, announced Ethereum as its primary reserve asset at the end of 2024. This move rapidly secured a $425 million financing agreement, significantly boosted market attention, and caused its market capitalization to soar from $2 million to tens of millions, completely reshaping its valuation logic.

Currently, the reserve structure for crypto-assets remains dominated by Bitcoin as the absolute leader. According to statistics, approximately 20 publicly traded companies have explicitly included BTC in their asset portfolios, including Strategy, GameStop, Trump Media, Rumble, Next Technology Holding, Cantor Equity, and others. Meanwhile, Ethereum is gradually becoming the second most popular reserve asset, with companies like BTCS, Treasure Global, and SharpLink Gaming opting to allocate ETH. Some companies have chosen more diversified asset allocation strategies. For instance, DeFi Technologies, Siebert Financial, and Interactive Strength are building hybrid crypto reserves that combine Bitcoin, Ethereum, and other tokens, seeking a balance between risk mitigation and market speculation potential.

From a time perspective, although Strategy initiated its Bitcoin reserve as early as 2020, few followed suit in the subsequent years. It was not until Q4 2024, when Bitcoin prices climbed back to record highs, that Strategy's stock prices saw a significant surge. This greatly boosted the returns of its "Bitcoin-stock" model, triggering an intense wave of crypto reserve adoption across the market.

Most of these follower companies have market capitalizations ranging from $100 million to $1 billion, with reserve targets varying from several million to tens of billions of dollars. For example, Strategy's Bitcoin reserve target is as high as $10 billion, Cantor Equity's is $3 billion, and Trump Media's is $2.5 billion. It's worth noting that some companies' reserve targets far exceed their market capitalization, creating a pronounced risk-leverage effect. While this can fuel market speculation, it also heightens the risk of valuation bubbles.

In terms of stock price performance, most companies witnessed explosive short-term gains after announcing their reserve strategies, with average peaks reaching 438.53%. Notably, since Strategy's initial announcement, its intraday peak gain hit 4315.85%; Asset Entities rose by 2096.72%; SharpLink Gaming by 1747.62%; and Kindly MD by 791.54%. However, some companies like SIEB, SILO, and DTCK showed little change in stock prices, likely reflecting market skepticism about their ability to execute consistently and the credibility of their narratives.

Of course, beyond the reserve strategies themselves, some companies amplified their market impact by securing strategic support from crypto giants or renowned investors. For example, SharpLink Gaming formed a strategic partnership with prominent players like ConsenSys, gaining backing from the Ethereum ecosystem. Cantor Equity Partners merged with Twenty One Capital and launched a BTC reserve strategy, supported by Tether, SoftBank, and Brandon Lutnick, the son of the U.S. Secretary of Commerce. Similarly, SRM Entertainment announced plans to center its reserves around TRX, backed by TRON founder Justin Sun. On June 17, the company's trading volume even temporarily surpassed that of Alibaba and Tencent. These injections of crypto-related influence provide companies with ecosystem-level advantages beyond financial allocations, enhancing the correlation between their on-chain assets and capital market dynamics.

It can be observed that an increasing number of publicly listed companies are no longer content with merely incorporating mainstream crypto assets like Bitcoin and Ethereum into their balance sheets. Instead, they are beginning to allocate assets such as XRP, SOL, TRON, and HYPE, among other emerging cryptocurrencies. In the future, crypto projects lobbying or partnering with publicly listed companies to establish reserves may become a new trend.

On the whole, the collective influx of publicly listed enterprises into the realm of crypto reserves ostensibly reflects a recognition of crypto assets but, at its core, demonstrates their adeptness at utilizing capital market mechanisms. This is particularly evident in the context of underwhelming performance and market cap limitations. Hot strategies like leveraging both crypto and stocks can significantly reshape valuation frameworks. In the short term, this offers small and mid-cap companies new avenues for financing and narrative repositioning. In the long term, factors such as whether the reserve structures are sustainable, assets appreciate in value, and on-chain activities remain transparent will be critical in determining whether this trend develops in a healthy manner.

Eating Public Companies’ "Pie"? Market Risks and Manipulation Debates Parallel the Trend

As the trend of companies integrating crypto assets into their balance sheets spreads rapidly, it has sparked widespread debate regarding risk management, market manipulation, and regulatory compatibility.

Bitcoin advocate and Bitcoin Magazine CEO David Bailey sees this trend as a paradigm shift in capital structure. He bluntly states, "Every time one of our Bitcoin treasury reserve companies is added to an index, a traditional company without Bitcoin gets kicked out. Sorry, but your liquidity has now become Bitcoin's liquidity. Join or get left out."

Blockstream CEO Adam Back issued a similar warning: "Bitcoin treasury reserve companies are steadily eating into the market share of publicly listed companies. If you ignore the greatest arbitrage opportunity of this century, the reallocation of capital will ultimately leave you behind. This is not really an 'optional' choice."

Dragonfly Managing Partner Haseeb Qureshi opines that in every market cycle, founders chase where the hot money flows. In the last cycle, token issuance was the focal point because of an exceptionally active crypto capital market. This cycle, injecting tokens into the stock market (a quasi-treasury model) has become the new trend. He notes that hot money never stays in one place for long, which is why treasury companies will not become the ultimate model. However, he predicts this trend will persist for another 1–2 years until the momentum fades.

As for risk management within crypto reserve companies, Strategy CEO Michael Saylor advises against "publishing proof of reserves on-chain." He cautions that publicly disclosing wallet addresses could pose long-term tracking risks for institutions. Additionally, he argues that reserve information without liabilities audited by the Big Four accounting firms is meaningless on its own.

Binance founder CZ also emphasized on social media, "These companies are taking on risks. Every company takes on risks. Risk is not a binary state like 0 or 1—that it either exists or doesn't. Risk lies on a spectrum from 0 to 100. As long as you find the right balance, you can achieve an optimal risk/ROI ratio that works best for you. Risk can and must be managed. Not taking risks is itself a form of risk."

Coinbase CEO Brian Armstrong, in a Q&A session, revealed that he had considered allocating as much as 80% of the company’s balance sheet to Bitcoin but ultimately decided against this aggressive plan. He explained, "That could have destroyed the company." According to him, in the early stages, a sudden drop in BTC prices could have shortened the company's financial runway from 18 months to just 10 months, negatively impacting funding and business development. He further stated that the company does hold Bitcoin on its balance sheet, with roughly 25% of net cash allocated to cryptocurrencies. "We’re not going to put 80% in; I think that’s too risky," he added.

As for some smaller publicly-listed companies announcing large allocations of reserves into altcoins, VanEck’s Head of Digital Assets, Matthew Sigel, pointed out that these companies claim they will purchase hundreds of millions of dollars worth of tokens (such as XRP and SOL). However, these so-called reserve plans are likely just strategies to pump the stock prices of small-cap companies, many of which are traded on Nasdaq. "A lot of it is insiders trying to pump and dump. If the market cap is negligible and no new investors are disclosed, I consider it a scam," Sigel said.

Regarding the expansion of such leveraged strategies, digital asset bank Sygnum warned in its latest report that companies like Strategy are continuously accumulating Bitcoin through leveraged means such as bond issuance. This deviates from traditional corporate financial practices. Such behavior could undermine Bitcoin's suitability as a central bank reserve asset, and the over-concentration of holdings could lead to reduced market liquidity, increased price volatility, and diminished appeal to central banks and other institutional allocators.

Bitcoin advocate Max Keiser also expressed skepticism about emerging Bitcoin financial firms mimicking Strategy's approach, pointing out that many have not yet been tested by a true bear market. He stressed, "Saylor has never sold Bitcoin during a bear market and has consistently bought instead. Only those companies that hold through the toughest market conditions can truly be considered Bitcoin treasury believers."

Overall, crypto assets are evolving from financial reserves to corporate strategy, but the success or failure of these strategies ultimately rests in the hands of the market.

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