The latest trend of crypto treasury companies/DATs is insane: Getting a loan to buy a single token, only to borrow more based on that growing balance sheet; Is degenerate behavior ill-advised for retail, let alone public companies! Up forever or bust is the new pump & dump! 🧵 As this economic flywheel goes both ways, everything is fine as long as the price goes up forever... However, when prices do eventually drop, most of these companies will become insolvent, unable to pay back their loans & unable to buy more Eventually forcing them into bankruptcy or a sale, putting most of these tokens back on the market & accelerating the crash, creating a vicious cycle... So much like a traditional pump and dump, it increases buying on the upswing & increases selling on the downswing. Making crypto prices far more volatile While likely burning countless innocent people in the process, I fail to see how this is good for crypto in the long run. This is short-term opportunistic greed, not progress Single asset portfolios, often traded at a premium, are not even a good product either. Their success is primarily due to their ease of access in traditional markets, where direct crypto exposure is still wrongly considered too risky, as this configuration adds significantly more risk than a crypto native fund, for example The incentives can also be extremely skewed, as the owners of these companies can sell their shares before the collapse happens. Leaving investors holding a bag of falling knives. In other words, this allows the perpetrators of this scheme to make a lot of money while their customers get wrecked This might not be true for all companies in this category, as they do not all operate under the same principles, but as far as I can tell, it is undoubtedly most, so buyer beware! Many are motivated to support this trend, as it pumps up the price. However, our energy is much better spent on focusing on real fundamentals: On-chain usage, application & protocol revenue, DeFi & ofcourse, by increasing bandwidth, reducing latency! The free market will fix this, even if it will be another lesson learned the hard way, as this cannot end well... Fortunately, crypto has a lot more going for it than only gambling on purely speculative assets. The value of crypto's utility far outshines the speculation, a fact that only becomes clearer over time. That is why we must keep our eyes on the prize & not get distracted by dangerous schemes Such "Dangerous schemes" have been a consistent theme in crypto's history: A struggle between common sense & greed, where greed often wins. From Mt Gox & Celsius to LUNA, we keep having to learn these lessons the hard way. We have to do a better job at self policing this industry, by collectively recognizing the risk inherent in such dangerous schemes instead of generally promoting them... That is what is good for crypto, not degenerate "up forever" treasury companies. We need to push back against this insanity, or we will also get swept up in that wave again 🌊