In 2025, a new type of company, known as a Digital Asset Treasury Company (DATCO), revolutionized the way people invest in cryptocurrency.
Over 200 DATCOs are now public companies, meaning their shares are bought and sold on the stock market.
Altogether, they manage over $100 billion in crypto. Because people can buy DATCO stocks through regular investment accounts, it allows everyday investors to access crypto without needing a digital wallet.
Stocks of companies like Bitmine, Eightco, and Forward Industries have skyrocketed, with some already increasing by over 400% this year, far outpacing the gains of most other stocks.
Warning Signs
But there are problems too. Financial regulators observed that many DATCO stocks surged just days before the companies announced plans to acquire more cryptocurrency.
The SEC and FINRA believe that some individuals may be privy to crypto-treasury plans and secretly purchase shares before the news becomes public, which is known as insider trading; it’s illegal.
Regulators are now warning that all major crypto announcements must be shared with everyone simultaneously, so no investor gains an unfair advantage.
Market Disconnect
There’s a big gap between Wall Street enthusiasm for DATCOs and traditional big-money managers. While DATCO stocks continue to rise, most professional fund managers still don’t own any cryptocurrency at all.
According to surveys, 67% of fund managers have zero crypto in their portfolios, and only a handful have even a small amount. That means regular investors and specialist funds are driving the DATCO boom, not the big institutional investors.
The low average crypto exposure, at just 0.4% of assets for all managers, demonstrates the significant untapped potential this market still offers.
Capital Tsunami
Vast amounts of fresh money have moved into DATCO stocks. Pantera Capital, a major player in crypto investing, says these companies have attracted tens of billions of dollars from individuals who previously avoided crypto.
Big deals are happening: Forward Industries raised $1.65 billion to buy Solana tokens, and Helius secured $500 million, with plans to reach $1.25 billion.
Since DATCOs can issue new shares more quickly than waiting for buyers on crypto exchanges, they can impact crypto prices in new ways.
In short, Wall Street cash can now easily move into crypto through public stocks.
The Big Numbers
The numbers behind these stocks are eye-popping.
Bitmine’s stock is up over 400% year-to-date, and it holds 2.65 million ETH, trading around $56 per share. Eightco’s price soared more than 3,000% in one day after it said it was holding Worldcoin.
Forward Industries’ shares have jumped 650% so far in 2025 after the company acquired over 6.8 million Solana coins.
DATCO companies typically trade at significantly higher prices than the actual cryptocurrency they own, as investors are willing to pay extra for the opportunity to profit even more if prices continue to rise.
Regional Impact
These trends are primarily occurring in major financial centers, particularly in the U.S., where it’s easier to access stock markets.
Companies are rapidly changing their business models: Forward Industries, which previously manufactured medical equipment, is now one of the world’s largest holders of Solana.
DeFi Development Corp transitioned from developing real estate software to managing crypto treasuries.
When companies like this cluster in the same places, it brings money, jobs, and investment to certain cities, helping local economies grow, but it also means those cities are more closely tied to the ups and downs of the crypto market.
Personal Stakes
People who invested early in DATCOs have made or lost huge sums. Someone who bought FORD at $3.30 early in 2025 and held until it hit $46 could have turned $10,000 into $140,000.
However, when crypto prices fall, smaller DATCOs can quickly drop by 60-70% or more, destroying people’s savings just as quickly.
Since DATCO stocks trade at sharp premiums to their asset values, a sudden change in sentiment can wipe out that extra value, meaning investors face more risk than if they had bought the crypto directly.
Market Mechanics
A feedback loop helps explain the DATCO phenomenon. When cryptocurrency prices rise, DATCO stock prices tend to increase as well.
That allows companies to sell more shares at high prices and use the cash to buy even more cryptocurrency. This buying can push prices even higher, which fuels more trading and excitement.
However, if crypto prices start falling or people lose interest, the cycle works in reverse: stocks fall, companies can’t issue new shares, and the whole system unravels quickly.
Expert Warnings
A growing chorus of experts warns that the DATCO model can be fragile. If too many companies adopt the same “raise money, buy crypto, repeat” approach, it creates a risk of sudden collapse.
When stock prices fall below the value of their crypto holdings, it leads to “death spirals” as the premium vanishes and forced selling can start.
Seven DATCOs have already borrowed money to buy back their own plunging shares, which is often a last-resort move, and in turn, making their situation riskier than ever.
Hidden Revelation
Many DATCOs aren’t just holding crypto in their vaults; they’re putting those coins to work through staking and yield farming.
This means locking up coins to help run networks like Solana, earning daily rewards from the process.
For companies holding millions of tokens, these payouts can be substantial; for example, Forward Industries earns $105,000 per day simply by staking.
Some earn yields as high as 8% per year, creating another income stream beyond crypto price gains.
This may help explain why DATCO stocks sometimes carry higher values than a simple pile of coins would justify.
Internal Tensions
Within these rapidly evolving companies, not everyone feels at ease. Many DATCO boards are split because their leaders come from traditional industries and lack experience with cryptocurrency.
Changing business models quickly, such as Forward Industries transitioning from 60 years in medical devices to full-time Solana investing, has confused investors and created tension at the top.
A lot rides on management teams handling crypto volatility, as they need to both maintain their stock premiums and comply with new regulations.
Ownership Shifts
The boom is changing who owns DATCO stocks. Significant crypto investment funds, such as Pantera Capital and Galaxy Digital, are acquiring large stakes, bringing deep expertise and sometimes a higher risk tolerance than traditional investors.
Classic investment funds may prefer stricter rules and safer strategies, while crypto funds want companies to be more aggressive.
If the crypto crowd and traditional investors disagree, it could lead to conflict over how companies manage their cryptocurrency strategies.
Response Strategies
DATCOs are preparing for more scrutiny by the SEC and for market swings. Many are hiring top law firms and regulatory experts.
Some, like Forward Industries, have set up massive $4 billion stock sale programs to keep buying crypto when prices are correct. Others are adding rules to manage risk, diversifying into multiple tokens instead of just one.
However, excessive hedging or risk management can weaken the pure crypto bet that made DATCOs so popular in the first place.
Recovery Attempts
Companies in trouble are scrambling to win back investors. Some have borrowed money against their cryptocurrency to buy back their own shares, for example, ETHZilla took out an $80 million loan to repurchase $250 million in stock after a 76% drop.
Others talk about mergers. The fact that raising new money by selling shares is becoming increasingly complex means that risky financial engineering may become more common for struggling DATCOs.
Future Implications
If DATCOs continue to grow, they could alter how institutions invest in cryptocurrency. Instead of relying on ETFs, pension funds and university endowments might use DATCOs to get crypto exposure.
However, allowing hundreds of highly leveraged companies to operate in these markets creates systemic risk. If sentiment turns negative and all DATCOs have to sell simultaneously, it could send cryptocurrency prices crashing.
The SEC’s current investigation will determine whether this risk is acceptable or if new rules are needed.
Regulatory Evolution
Regulators are moving fast. The SEC may soon require detailed reporting from DATCOs on matters such as how they store cryptocurrency, the valuation methods they employ, and their risk management practices.
Congress will also investigate whether new laws are needed to protect investors. The U.S. Treasury is examining how to tax these companies, particularly for the additional income generated from staking.
Depending on what regulators decide, new rules could help DATCOs stay safe and stable or squeeze their profits and slow their growth.
Industry Ripple Effects
The DATCO trend is also shaking up other industries. Firms like Matrixport now offer specialized services for DATCOs, such as secure crypto custody and lending.
Central Wall Street banks have established new crypto advisory teams to assist with significant transactions, and insurance companies are developing specialized policies to address the unique risks associated with holding substantial cryptocurrency holdings.
Even accounting firms are hiring experts to audit these complex portfolios.
Social Media Frenzy
On social media, DATCO stocks have become the new meme craze. Groups on Twitter and Reddit hype certain stocks as the next big thing, influencing prices with viral posts that push them up or down.
Some people spread misinformation by either hyping up the risk or spreading panic, making these stocks even more unpredictable than regular crypto.
This online buzz helps drive big wins and significant losses for individual traders.
Historical Parallels
The DATCO craze bears a resemblance to past booms and busts. In the 1990s, companies with an internet connection saw their stock prices soar, even if their businesses weren’t generating real profits.
The 2017 ICO bubble was similar, marked by excessive hype, rapid growth, minimal oversight, and significant collapses.
DATCOs are safer since they work within the stock market’s standard rules, but history shows that all booms eventually slow, and not every company will survive.
High Stakes
DATCO stocks offer regular investors a simple, high-risk way to access the world of crypto, with no wallet required, just a brokerage account.
But the stakes are high. DATCO share prices can rise rapidly but fall just as quickly. Ongoing investigations by regulators will determine how much longer this model can continue to grow.
Investors need to be careful: treat DATCOs as speculative bets, watch for sudden changes, and never invest more than you can afford to lose.
For now, they are at the center of the crypto story, but nobody can promise how long the ride will last.