The world of Digital Asset Treasury (DATS) has entered a new era after announcing an all-stock deal this week to acquire Semler Scientific (SMLR).
The deal marked the first merger of two publicly published Bitcoin Treasury, and according to a Wall Street banker familiar with the situation, this is just the beginning of a massive wave of integration between data.
Bankers who chose to remain anonymous outlined three scenarios for how DATS evolved.
Merger to add more BTC
The first of the three passes is a DAT-to-DAT merger.
The acquisition of Strive’s Semler is the first clear example of unifying BTC holdings, increasing Bitcoin per share, and establishing governance under one roof.
Once it is closed, the deal will create a new company that will hold about 11,000 BTC after a simultaneous purchase of $675 million of 5,885 coins.
It is worth noting that Semler’s stock was below Bitcoin’s value and effectively allocated negative value to the medical device business. For the effort, the acquisition integrates the balance sheet, adds BTC scale and advances the metrics of key companies: Bitcoin per Bitcoin.
“The announcement of the Strive merger is subsidized with Bitcoin per share, achieving its short-term goal,” CEO Matt Cole wrote to X.
“We believe the power of the combination of entities allows conglomerates to increase Bitcoin per share and have access to capital markets in ways that increase in ways that they cannot.”
As the Bitcoin financial market is saturated with many public companies, this strategy could be one of the most efficient ways to grow for data.
Cash flow angle
The bankers said the second path of evolution is gaining cash-infused companies to offset the dilution and fund ongoing BTC purchases.
Metaplanet, Japan’s largest Bitcoin holder, has already said it plans to use the Ministry of Finance to purchase cash-generating companies as part of its “Phase 2” strategy.
Metaplanet is also investigating the use of permanent preferred stock, a funding strategy already employed by Strategy (MSTR), allowing shareholders to purchase Bitcoin without dilution through the provision of market (ATM) common stock.
There are no more spacks
Third, bankers say they are joining legal businesses instead of using special purpose acquisition companies (SPACS).
SPACS is a shell company designed to expose companies quickly, but the “DE-SPAC” process is messy and requires you to suffer from shareholder votes, regulatory applications, and often investors redemption. Many SPACs rely on pipes to make things more complicated and bridge the funding gaps (private investment in fairness). This brings dilution, discounts and uncertainty.
In the case of data, merging directly with companies that already have operations and governance avoids these pitfalls.
Data evolution
The bottom row means that data needs to evolve and become creative with a growth strategy.
In fact, other companies have already caught up with this trend. Recently, FRNT Financial (TSXV: FRNT) Digital Asset Investment Bank said it has concluded a consulting agreement with a private DAT that includes $100 million worth of digital assets on its balance sheet.
According to the terms of the transaction, FRNT will help assess and build lending opportunities for the company’s next stage of growth.
Transactions such as the Strive-Semler merger indicate that digital asset financing companies need to expand their integration and work with established operators who either buy profitable businesses or provide legitimacy that will guide the next stage of DATS evolution.
Read more: Semler Scientific still has a rise of nearly 170% after effort: Benchmark
