Digital asset treasury company (DAT) firms are facing challenges as stock declines lead to selling off crypto to fund share buybacks. FG Nexus (FGNX) sold 10,922 ETH, worth $33 million, to repurchase 3.4 million shares at an average price of $3.45, below the reported NAV of $3.94 per share.

The news caused a 2% drop in ETH and a 1% drop in Bitcoin prices, but both have slightly recovered. FG Nexus now holds 40,000 ETH, $37 million in cash, and USDC stablecoin. Other DATs are also selling crypto to fund share buybacks.

Share buyback programs aim to close the gap between stock prices and NAV, but raise concerns about the sustainability of operations. FG Nexus plans to continue buying back shares to increase per-share valuation metrics. FGNX shares were up 2% in early trading, still down over 95% from last summer’s peak.

Read more at Yahoo Finance: Ether Treasury Firm FG Nexus Unloads Nearly 11K ETH to Fund Share Buyback