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FG Nexus sold $32.7 million in Ethereum to fund share buybacks after its stock fell 94% in four months, highlighting the deepening net asset value (NAV) crisis among digital asset treasury companies.
The sale follows ETHZilla's $40 million ETH offload in October, underlining mounting pressures throughout a sector managing over $42.7 billion in cryptocurrency assets. This wave of forced selling underscores vulnerabilities in the corporate crypto treasury model, as companies wrestle with stocks trading below the value of their underlying asset holdings.
FG Nexus disclosed selling 10,922 ETH in October to support a $200 million share buyback. The company began repurchasing shares after its stock fell steeply below NAV, a measure of per-share underlying crypto value. FG Nexus retained 40,005 ETH and $37 million in cash, with total debt rising to $11.9 million, as of Wednesday.
The firm bought back 3.4 million shares at about $3.45 each, representing 8% of its outstanding shares. Management stressed that shares were purchased at a discount to NAV, which reached $3.94 per share by mid-November. This strategy, however, required roughly $10 million in debt and a liquidation of 21% of ETH reserves compared to September levels.
FG Nexus is one of several digital asset treasury companies pursuing crypto sales. ETHZilla announced an approximate $40 million ETH sale to facilitate stock repurchases in late October. The company bought 600,000 shares for nearly $12 million since October 24, seeking relief from a persistent 30% discount to NAV.
When a DAT company’s shares trade at a discount to the value of its crypto holdings (mNAV below 1.0), shareholders push management to realize that hidden value. The most effective way to do this is through a stock buyback, but securing the funds necessary to repurchase shares requires cash. If the company lacks sufficient cash reserves, it must sell some of its crypto assets to finance the buyback.
The mNAV of Metaplanet, a DAT company that accumulates Bitcoin, dropped to 0.99 before recovering to 1.03. Its shares have lost 70% since their June highs, signaling sector-wide stress. The use of perpetual preferred equity, which blends fixed dividends with crypto exposure, further complicates capital structures already under pressure from current market conditions.
DAT companies deployed $42.7 billion in crypto during 2025, with $22.6 billion accumulated in Q3 alone. This expansion accelerated as Bitcoin rallied above $126,000 in October, fueling positive feedback loops and rising valuations. However, subsequent reversals exposed weaknesses in capital structures built on leverage and capital market access.
Treasury companies account for only 0.83% of total crypto market capitalization. Their concentration of holdings, however, amplifies their impact during downturns. Leverage via convertible notes, PIPE deals, and perpetual preferred equity increases selling pressure when prices fall or NAV discounts widen.
Market liquidity deteriorated sharply as asset prices dropped. Bitcoin's order book depth at the 1% band fell from $20 million to $14 million—a 33% decrease that heightens price sensitivity to any selling. Analysts estimate forced treasury company sales could reach $4 billion to $6 billion if 10% to 15% of positions are liquidated, potentially surpassing November's $2.33 billion in ETF outflows.
Corporate crypto buying has stalled due to waning confidence and reduced capital deployment. Companies that once offered steady demand are now selling, reversing earlier positive cycles. MicroStrategy’s stock fell 60% amid Bitcoin volatility, showing the risk of correlation between crypto prices and equity values even for companies with solid balance sheets.
Smaller treasury firms are under increased stress, especially those holding less liquid assets. Several firms exposed to Solana experienced 40% NAV drawdowns as concentrated bets deepened losses. Limited diversification and thin trading volumes in alternative cryptocurrencies add to broader sector vulnerabilities.
Retail investors also contributed to selling by exiting positions in advance, reducing market demand as institutional holders began liquidating. In November, $4 billion in ETF outflows and reduced market-maker activity intensified volatility. These conditions resemble leverage-fueled market crashes seen in other asset classes, such as the 2008 mortgage REIT crisis.
This growing crisis challenges the resilience of the digital asset treasury model in prolonged downturns. Rigorous risk management and regulatory oversight could be necessary to prevent self-reinforcing selloffs from destabilizing the broader market. In the weeks ahead, these companies’ ability to maintain their crypto holdings without further forced liquidation will determine whether the sector survives intact or undergoes fundamental restructuring.
