In brief
- Tron Inc. stock has fallen 85% since June, part of a broader downturn for crypto-linked public companies.
- MSTR, BMNR, and the majority of publicly listed treasury companies are down double digits from their three-month peaks.
- This sell-off is a digital asset treasury trend, not a problem unique to any single firm, experts told Decrypt.
Tron Inc., a TRX treasury company, has been on a sustained downtrend since its mid-June peak.
The Nasdaq-listed toy and souvenir manufacturer is down 85% from its June 20 peak of $12.80, according to TradingView data. In September alone, the company witnessed a 55% decline.
“The hype is deflating,” Peter Chung, head of research at Presto Research, told Decrypt.
Chung noted that it is common for hype and frenzy to take over when a new meta is introduced, leading to outsized gains. As cooler heads prevail, the asset tends to find a stable footing, leading to a decline in its valuation.
“This year it happened with Circle IPO, and is happening with DATs,” he explained.
“It’s not just Tron,” Czhang Lin, head of LBank Labs, told Decrypt. “Many firms in the space are navigating similar headwinds.”
Tron Inc., which was listed on Nasdaq on July 24 through a reverse merger with SRM Entertainment, is not the only crypto treasury company facing a slump.
Stephen Gregory, founder of crypto trading platform Vtrader, told Decrypt that the recent drop in crypto treasury companies was a result of “bad execution” and “rushing to the market” without “fully fleshing out” their strategy.
Gregory noted that the U.S. Securities and Exchange Commission and the Financial Industry Regulatory Authority’s investigation involving 200 firms for suspicious stock trades preceding crypto treasury announcements is also part of the reason why the stock prices of crypto-linked companies are dropping.
Bitcoin treasury company MicroStrategy (MSTR) is down roughly 30% in the last three months, while Ethereum treasury company Bitmine Immersion Technologies Inc. has also shed 67% over the same period.
Justin Sun, who serves as an adviser to Tron Inc. and is the founder of TRON, has long been at the center of speculation and allegations, from his early ICO days in China to a recent run-in with U.S. law enforcement for allegedly selling unregistered securities related to TRON and BitTorrent.
Despite navigating regulatory challenges, Sun’s recent actions involving the Trump-family-linked World Liberty Financial project have had an immediate impact.
After WLFI’s token generation event on September 1, Sun claimed 600 million tokens and moved 9 million to the HTX exchange, which he alleged were “routine tests and address splits,” without any intention to sell.
The move prompted the WLFI project to freeze Sun’s remaining 591 million unlocked tokens.
TRX is down nearly 1% in the past 24 hours and is currently trading at $0.33, with a market capitalization of $31.56 billion, making it the tenth-largest crypto in the industry.
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