Several cryptocurrency treasury companies' stock prices declined, shifting to explore digital credit fundraising, but sustainability is questionable.

Deep Tide TechFlow News, May 31 — According to the Financial Times of the UK, as the prices of cryptocurrencies like Bitcoin weaken, some crypto treasury companies that focus on holding crypto assets have started shifting toward a new financing tool called "Digital Credit" after their stock prices declined. This model is promoted by Strategy, offering investors high-yield perpetual preferred shares, while the raised funds are used to continue purchasing Bitcoin. Since its launch about 10 months ago, it has attracted approximately $10.5 billion in capital inflows. Currently, several crypto reserve companies are planning to emulate this model, including Strive Asset Management, The Smarter Web Company, Capital B, and others.

However, the sustainability of this model has raised market concerns. Since the preferred stock dividends mainly depend on continuous financing support rather than operating cash flow, some analysts worry about its long-term viability. Meanwhile, the enthusiasm for the crypto reserve concept has cooled, with many related companies' stock prices falling sharply from their highs, and some firms even being forced to sell crypto assets and return to their original core businesses.