Did E-Wai Bing worship the wrong idol? The encryption treasury company is merely a Whale trap cashing out mechanism, a fabricated "coin buying" strategy to profit from stock market premiums.

Since MicroStrategy took the lead in purchasing Bitcoin in 2020 and opened the trend for corporate treasury allocation in crypto assets, more and more companies have begun to follow suit, attempting to enter the virtual money market through massive fundraising. However, despite the influx of funds amounting to hundreds of millions or even billions of dollars, the prices of crypto assets have not seen a significant boost. What structural phenomena are hidden behind this?

According to the analysis by London fintech analyst Boaz Sobrado in the article “The Crypto Treasury Pump: Insiders Cashing Out Billions?” dated July 24, 2025, these “treasury companies” may just be arbitrage outlets for crypto whales.

Unconditional supporters of ETH, commonly known as E Guardians, strongly praise it during this round of listed company ETH treasury boom, believing it is a step toward institutional adoption of ETH; if crypto treasuries are indeed the arbitrage outlets for crypto whales, then they might have truly worshipped the wrong idol. Moreover, those E Guardians who seek to increase the utilization of the Ethereum network and promote decentralized infrastructure, if they hope for institutions to stockpile, as a form of spiritual victory, may also be putting the cart before the horse.

( From Laughing Stock to Faith: “E Guardian” Becomes the New Meme of the Ethereum Community )

MicroStrategy opens the Pandora’s box of buying coins.

In 2020, MicroStrategy took the lead in investing in Bitcoin, successfully bringing traditional financial capital into the Crypto Assets market through debt and equity financing. Founder Michael Saylor’s strategy not only allowed the company to accumulate a large amount of Bitcoin but also created a premium trading space for stocks, allowing investors to indirectly enjoy leveraged exposure to Bitcoin.

As of early 2025, the company has become the largest corporate holder of Bitcoin in the world, with approximately 450,000 BTC. However, after the launch of Bitcoin ETFs, investors can buy Bitcoin directly through traditional financial instruments, which should have cooled down the corporate treasury model. Contrary to expectations, treasury companies are instead becoming increasingly rampant.

The treasury company is going crazy entering the market, but not to buy coins?

SharpLink Gaming, Upexi, GameStop, Bit Origin and other companies have recently announced large-scale fundraising plans to establish treasury reserves in Ethereum, Solana, Bitcoin, and even Dogecoin. For example:

SharpLink Gaming: Announced a $425 million private placement plan to transform into an Ethereum holding platform.

Upexi: Raised over $300 million in 2025 to purchase approximately 1.9 million Solana.

GameStop: Issues $1.5 billion in convertible bonds to purchase 4,710 Bitcoins.

Bit Origin: Expected to raise 500 million USD to build the Dogecoin treasury.

Most of these companies originally had no connection to encryption-related businesses, but a simple announcement of transformation can trigger a surge in stock prices, attracting strong market attention and speculation.

Neuner: These companies are not buying coins, but rather serve as a bridge for coin owners to cash out.

The founder of the Crypto Banter channel and CEO of Onchain Capital, Ran Neuner, pointed out in an interview that these treasury companies do not actually purchase coins from the market, but are designed as arbitrage tools that allow early coin holders (such as venture capital firms and crypto funds) to convert their crypto assets into stocks.

The process is as follows:

Holders will contribute ETH, SOL, or other coins to the company.

Exchange for shares equivalent to the value of Crypto Assets.

Once the company is listed or announced, the stock is traded at a premium (usually 2–4 times the net assets).

The original coin holder sells part of the stocks, recovers the originally invested encryption assets, and additionally profits.

Neuner bluntly stated: “This is a way for high-level players in the encryption circle to resell their assets at a high price to retail investors in traditional finance, and it will not directly drive up coin prices, nor will it face market volatility or regulatory scrutiny.”

Digital Misalignment: The Upexi and SharpLink Cases Reveal the Fictional “Coin Purchase”

Upexi claims to have purchased 1.9 million Solana, but the data shows that most of the tokens may not have been acquired through the public market, but rather obtained in the form of lock-up discounts, or even converted from existing crypto investors. The shareholder structure also reveals familiar faces, such as well-known crypto funds like Arrington Capital, Electric Capital, and Pantera, which themselves hold a significant amount of Crypto Assets.

Neuner pointed out: “They did not invest new funds; they simply exchanged their original coins for shares and then took advantage of the premium arbitrage in the stock market.”

The treasury company let retail investors buy the premium illusion of “virtual crypto assets”.

Treasury company stocks often trade at prices far exceeding their actual coin value. For example, a company with an equivalent of 100 million dollars in Ethereum may have a total stock market value exceeding 400 million dollars. When retail investors enter, they are effectively “indirectly holding coins” at a premium of 3 to 4 times, completely ignoring the low-cost alternative of directly buying coins.

Neuner warned: “The current ETH price is $35,000, and some would rather spend this amount to buy shares in a company that indirectly holds coins, rather than buying coins directly on Coinbase. This is a bubble.”

Why will this bubble eventually burst? History has verified this multiple times.

The last two crypto market crashes were triggered by leverage and structural capital restructuring:

2017: The ICO (Initial Coin Offering) bubble burst.

2021: Institutions like Luna and FTX collapsed due to algorithmic stablecoins and leveraged operations.

Neuner predicts that if the treasury company continues to expand, a similar scenario will eventually repeat. When the market turns bearish, these stocks will no longer be at a premium, but may instead trade at a discount, leaving retail investors with the largest losses.

The real driving force behind coin prices still lies in the spot and ETF markets.

Despite the astonishing media coverage of the treasury company, its actual impact on the crypto prices remains marginal. Neuner believes that what truly has a boosting effect is:

The actual buying pressure of the ETF.

Direct deployment by institutional investors.

Actual user growth of decentralized applications.

He summarized: “The treasury company is merely a product of financial engineering, a mechanism for transferring the existing wealth in the encryption circle to retail investors in the traditional market, and has little to do with the true creation of encryption value.”

Is the article about E Guardians worshiping the wrong idol? The Crypto Assets Vault Company is just a giant whale cash-out mechanism, with a fictitious “buying coins” profitably enjoying stock market premiums, first appearing in Chain News ABMedia.