According to Bloomberg reports, as the digital asset industry flourishes, 160 listed companies have been inspired by industry pioneer Michael Saylor to gradually promote Bitcoin financial strategies. They are no longer satisfied with merely holding these assets; instead, they choose to lend out Bitcoin, lock it up to earn rewards, or sell options, aiming to turn idle assets into sources of income.
According to insiders, Twenty One Capital, a Bitcoin finance firm supported by the U.S. financial services company Cantor Fitzgerald, stablecoin issuer Tether, SoftBank Group, and payment company Strike CEO Jack Mallers, is considering whether to lend dollars using Bitcoin as collateral.
Twenty One Capital spokesperson stated:
Related report: “Twenty One Capital’s holdings exceed expectations! A total of 43,500 Bitcoins worth over $5 billion.”
Generating Income from Idle Crypto Assets
These listed companies’ holdings of crypto assets remain largely passive in nature, symbolizing more than actual strategic objectives. However, reports indicate that some companies are overturning this logic: inaction is no longer a principle but a waste of capital, especially for companies under pressure.
DDC Enterprise, the parent company of the Hong Kong recipe website “Everyday Cooking,” is a loss-making Asian food company. A stock price plunge this spring led to a suspension of trading on the New York Stock Exchange. Subsequently, the company executed a reverse stock split, heavily invested in Bitcoin, and repositioned itself as a “leading Bitcoin finance company,” causing its stock price to surge over 800%. In July, the company announced a partnership with Singapore asset management firm QCP Capital to generate returns on its Bitcoin assets.
QCP founder Darius Sit stated:
Cryptocurrency firm Pantera Capital’s general partner Cosmo Jiang noted that the “vast majority” of crypto finance companies are now exploring yield strategies. Companies choosing to hold Ethereum (ETH) and SOL as reserves have profited through staking, and some are also considering lending or utilizing decentralized finance (DeFi) ecosystems to increase revenue, such as SharpLink Gaming.
Another Bitcoin finance company, Bitcoin Standard Treasury Company, is considering selling put options to buy more Bitcoin at discounted prices when prices drop. GameSquare, besides holding Ethereum, recently spent $5 million acquiring a CryptoPunk NFT, not just for collection but intending to monetize it through licensing operations.
Bitcoin itself does not generate interest; for companies to earn income, they must rely on lending, collateral, or options operations to extract returns. This is an undeveloped new territory, and many Bitcoin finance companies are still in the planning stages.
However, not everyone is optimistic about this pursuit of yield. Chris Rhine, a senior executive at digital asset management company Galaxy Digital, which provides yield advisory services, stated:
