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FG Nexus sold $32.7 million worth of Ethereum to fund a share buyback after its shares fell 94% in four months, highlighting a net asset value (NAV) crisis in more digital asset treasurers.
The sale follows ETHZilla’s offloading of $40 million of ETH in October, highlighting mounting pressures in a sector that manages more than $42.7 billion in cryptocurrency assets. This wave of forced selling highlights holes in the company’s crypto treasury model, as companies stumble with shares trading below the value of their underlying assets.
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Financial companies resort to selling assets in the collapse of stocks
FG Nexus revealed on Sold 10,922 ETH in October to support a $200 million stock purchase. The company began buying shares after its shares fell well below NAV, a measure of the cryptocurrency’s value per share. FG Nexus held 40,005 ETH and $37 million in cash, with total debt rising to $11.9 million, as of Wednesday.
The company purchased 3.4 million shares at a price of about $3.45 each, representing 8% of its outstanding shares. Management stressed that the shares were purchased at a discount to NAV, which reached $3.94 per share in mid-November. This strategy, however, requires about $10 million in debt and the liquidation of 21% of ETH reserves compared to September levels.
FG Nexus is one of several digital asset treasury companies looking to sell cryptocurrencies. ETHZilla announced on Sold about $40 million of ETH to facilitate share purchases in late October. The company bought 600,000 shares for about $12 million as of Oct. 24, seeking to exit a permanent 30% discount to NAV.
When DAT shares trade at a discount to the value of their cryptocurrency holdings (mNAV below 1.0), shareholders push management to realize this hidden value. The most effective way to do this is through the purchase of shares, but to secure the necessary funds to buy the shares requires money. If a company lacks sufficient cash reserves, it must sell some of its cryptocurrency assets to finance the purchase.
The mNAV of Metaplanet, a DAT company that collects Bitcoin, fell to 0.99 before recovering to 1.03. Its shares have lost 70% since their peak in June, indicating broad pressures in the sector. The use of perpetual preferred shares, which combine fixed dividends and exposure to cryptocurrencies, will also complicate capital structures that are already suffering from the pressures of current market conditions.
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Leverage structures amplify the pressure in the markets
Company DAT deployed $ 42.7 billion of cryptocurrencies during 2025, with $ 22.6 billion accumulated in the third quarter alone. This expansion accelerates with height Bitcoin above $126,000 in October, resulting in positive feedback loops and an increase in ratings. However, subsequent reviews have revealed weaknesses in leveraged capital structures and access to capital markets.
Treasury companies make up only 0.83% of the total capitalization of the cryptocurrency market. However, the concentration of their holdings magnifies their impact during recessions. Leverage between convertible notes, PIPE offers, and perpetual preferred shares increase selling pressure when rates fall or NAV discounts widen.
Market liquidity has deteriorated sharply as asset prices fall. The depth of the order book is decreased by Bitcoin At an interval of 1% from $20 million to $14 million – a decrease of 33% increases the sensitivity of the price to any sales. Analysts estimate Forced corporate treasury sales could reach $4 billion to $6 billion if 10% to 15% of positions are liquidated, which could exceed November ETF flows of $2.33 billion.
Systemic risk increases as buying stops
The acquisition of cryptocurrency companies has stalled due to the decrease in confidence and the reduction in the distribution of capital. Companies that provided stable demand are now selling, reversing previous positive cycles. The shares fell Microstrategy 60% due to Bitcoin volatility, illustrating the risk of correlation between cryptocurrency prices and stock values ​​even for companies with strong balance sheets.
Smaller treasury firms are facing increasing pressure, particularly those holding less liquid assets. Many companies related to…Solana to drop in NAV of 40% as concentrated bets deepen losses. The lack of diversification and the small volume of trading in alternative cryptocurrencies contribute to increased risks in the wider sector.
Retail investors also contributed to the sell-off by exiting positions early, reducing demand in the market as institutional holders began to liquidate. In November, $4 billion of ETF outflows and lower market-making activity increased price volatility. These conditions are similar to leveraged market crashes seen in other asset classes, such as the subprime REIT crisis of 2008.
This growing crisis challenges the resilience of the treasury model for digital assets in long recessions. Tight risk management and regulatory oversight may be necessary to prevent self-reinforcing sales from destabilizing the broader market. In the coming weeks, the ability of these companies to maintain their cryptocurrency without additional forced liquidations will determine whether the sector remains consolidated or undergoes a fundamental restructuring.
