At least 12 companies that built their businesses around acquiring digital assets have recently shifted their focus to AI. Bloomberg noted that this strategic change has yet to rekindle investor interest.
Stocks tracked by the publication of digital asset treasury (DAT) firms in the US and Canada have shown a median decline of 43% since the beginning of the year. Many are trading below the net value of their assets, and management teams are exiting the business.
Journalists provided specific examples of business “transformation.” For instance, Bitcoin-accumulating K Wave Media Ltd. shifted to developing data centers—since its relaunch in May, its shares have dropped by 71%.
Shares of Lixte Biotechnology Holdings Inc. fell by 33% after the company agreed to merge with an energy sector firm in June. AlphaTON Capital, which holds altcoins, lost 33% following its rebranding to Alpha Compute in April.
Bloomberg directly links the weakness of the DAT sector to the dynamics of the assets themselves.
Gregory Sichenzia, founder of the law firm Sichenzia Ross Ference Carmel LLP, succinctly described the change in sentiment: last year, “nothing bad was expected” from crypto treasuries, but this year the term has become a “dirty word.”
He believes the shift to AI is logical, as significant capital is currently flowing there. Spending by tech giants like Alphabet and Microsoft, as well as startups like OpenAI and Anthropic on computing infrastructure, has made companies associated with data centers the best-performing stocks in major indices.
Almost all of the top 10 performers in the S&P 500 index produce data center-related products, including SanDisk, whose shares have risen by more than 500%, as well as Dell Technologies, Intel, and Micron Technology.
Attempts to capitalize on the AI hype extend far beyond the crypto market. Bloomberg cites the example of shoe manufacturer Allbirds, which shifted towards computing infrastructure after its own stock collapse and rebranded as Smartbird.
Among crypto industry companies, Bitcoin miners are faring better than DAT firms in pivoting to AI. CoreWeave shifted to cloud computing, positively impacting its stock.
Shares of Hut 8, Iren, and TeraWulf are also recovering after repurposing their data centers for data processing.
Daniel Forman, a partner at Lowenstein Sandler, emphasized that investors are not completely abandoning blockchain; interest remains in other areas of the technology, but not in the digital treasury model in its current form.
Earlier, Coinbase CEO Brian Armstrong called the pivot to AI by crypto projects a mistake.
