Digital asset treasury (DAT) companies could soon enter a wave of consolidation as competition intensifies, with mergers and acquisitions likely becoming a key survival strategy, according to Coinbase’s head of investment research.

David Duong, Coinbase’s head of investment research, told Cointelegraph that as the DAT sector matures, firms will need to differentiate themselves in order to attract investors. Beyond traditional financial maneuvers, Duong said consolidation similar to Strive’s recent acquisition of Semler Scientific could become common.

Earlier coverage: Crypto Funds See $812M Outflows, But Solana Defies Trend With $291M Inflows

“Companies may start to pursue mergers and acquisitions, much like the recent Strive and Semler Scientific deal, as we approach the more mature phases of the DAT cycle,” Duong explained.

On Sept. 22, Strive announced it would acquire Semler Scientific in an all-stock transaction, marking one of the first major M&A deals in the crypto treasury space.

Source: Strive 

At the same time, many DATs are experimenting with more crypto-native strategies, including yield generation through staking and DeFi looping — the practice of repeatedly borrowing and redeploying assets to amplify returns.

“There’s still a lot more they can do here,” Duong added. “The future will depend a lot on regulatory shifts, liquidity, and market pressures to determine where this could all go long-term.”

Standard Chartered analysts previously warned in mid-September that not all DATs will survive, pointing to market saturation and investor skepticism as key risks.

The Battle to Dominate Tokens

Coinbase researchers Duong and Colin Basco noted in a Sept. 10 report that DATs are now in a “player-vs-player” phase, where competition has shifted from sector growth to survival.

In recent weeks, a number of treasury companies have launched aggressive share buyback programs to try to boost their stock prices.

Trump Jr.-linked Thumzup, which holds Bitcoin and Dogecoin, expanded its buyback program from $1 million to $10 million on Sept. 24. Similarly, DeFi Development Corp, a Solana treasury company, raised its program from $1 million to $100 million.

Source: DeFi Development Corp

“I believe companies are under the impression that only a handful of major players will dominate each token,” Duong said. “They are competing to stand out either through sheer size or by financial engineering.”

But Duong warned this approach may have contributed to September’s negative price action, as firms prioritized shareholder optics over long-term accumulation of crypto assets.

Share Buybacks Don’t Guarantee Success

While share buybacks are often viewed as a bullish signal, Duong emphasized that the market’s reaction depends heavily on investor sentiment.

“The effectiveness of buybacks hinges on investors’ perceptions of a company’s underlying fundamentals,” he explained. “If buybacks look defensive, markets may see them as a sign of weakness rather than strength.”

TON Strategy Company (formerly Verb Technology) announced a buyback on Sept. 12, but its stock fell 7.5%, showing that such moves can backfire if confidence is lacking.

DAT Holdings Keep Growing

Despite the volatility, DATs collectively control large reserves of top digital assets.

  • Bitcoin: Over 1.4 million BTC, worth roughly $166 billion, representing 6.6% of total supply.
  • Ethereum: 68 companies hold about 5.49 million ETH, valued at more than $24 billion.
  • Solana: Nine entities together hold 13.4 million SOL, worth over $3 billion.

Companies have acquired over 1.4 million Bitcoin as a treasury asset. Source: Bitbo 

As the sector grows, consolidation may determine which firms emerge as dominant players in this new market structure.