Money-losing companies with colorful histories have pivoted to crypto

A marketer of shark-repellant sunscreen.A maker of chocolate-flavored whiskey.

A seller of a drink that promises to quickly lower blood-alcohol levels.Until recently, these businesses had significant losses and floundering stock prices in common.Now, they’re members of a legion of publicly traded companies helping to power one of the biggest trends in markets and the crypto industry.So far this year, billions of dollars have flowed into companies that have reinvented themselves by making the buying and holding of cryptocurrency their main focus.

More than 200 public companies have announced plans to hold crypto on their balance sheets as so-called digital asset treasury companies, or DATs.The rebranding as crypto companies came after years of losses in a variety of niche enterprises that include making lavender-flavored vodka, manufacturing materials for indoor marijuana growers, and selling ozone-infused water as part of a “nanobubble” cleaning technology.The trend has attracted a wide range of people, from obscure to more well-known investors.“We’re going to change finance forever, it’s that simple,” President Donald Trump’s son, Eric Trump, said in August at a Nasdaq opening bell ringing ceremony for a new DAT focused on a cryptocurrency founded by the Trump family.“It’s a great milestone for our country.”But just how transformative the DAT craze will be remains to be seen, as questions mount about the sustainability of this trend.

Many new DATs have seen prolonged stock slides after receiving an initial bump.“We are probably past peak DAT, if we’re being honest about it,” said Austin Campbell, the founder of Zero Knowledge Consulting and an adjunct professor at New York University’s Stern School of Business.Publicly traded companies turn themselves into DATs by raising money through the sale of stocks and then use that money to buy types of crypto.The money is often raised from private investors, sometimes with ties to the type ...

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Publisher: ABC News

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