Bitcoin treasury model faces extended pressure as Sequans exits DAT model

• Sequans Communications has exited its Bitcoin treasury strategy, liquidating holdings to reduce debt and refocus on its core operations.
• Declining Bitcoin price and tighter liquidity continue to test the DAT model, forcing firms to reassess leverage and capital allocation.
• Strategy remains the major firm preserving its holdings while using equity to fuel more Bitcoin purchases.

The wave of corporate Bitcoin (BTC) adoption that contributed to a strong market performance last year is showing clear signs of deceleration. Bitcoin’s retracement below key support levels has exposed weaknesses in the Digital Asset Treasury (DAT) model, prompting companies to reassess their treasury strategies.

The popular model of raising capital and allocating to Bitcoin has become increasingly difficult to sustain amid tighter liquidity conditions and elevated volatility.

Sequans ends DAT model with plans to sell off remaining Bitcoin holdings

Sequans Communications (SQNS) announced Thursday that it has fully redeemed its remaining convertible debt and is winding down its Bitcoin treasury strategy.

https://sequans.com/sequans-completes-full-redemption-of-convertible-debt-reestablishes-pure-play-focus-on-iot-semiconductor-growth/

The company disclosed that the redemption was funded in part through Bitcoin sales, leaving it with approximately 658 BTC on its balance sheet, now fully unrestricted. Sequans stated it is “no longer pursuing a digital asset treasury strategy” and intends to gradually monetize its remaining holdings.

The decision marks a decisive pivot back to its core semiconductor business, with renewed focus on 4G and 5G cellular IoT solutions.

CEO Georges Karam described the move as a “turning point,” citing a strengthened balance sheet and improved operational focus.

“We have strengthened our balance sheet, simplified our capital structure and are now fully focused on scaling our IoT semiconductor business,” he said.

At its peak, Sequans held more than 3,200 BTC, but declining revenues, operating losses and Bitcoin’s price volatility placed increasing strain on the strategy. In the first quarter of the year, the company sold over 1,000 BTC, signaling mounting pressure on its balance sheet.

Sequans’ exit from the DAT model reflects a broader shift across the sector. In 2025, over 200 public companies adopted or expanded Bitcoin treasuries as the DAT strategy showed promise. However, the post-peak environment continues to impact the balance sheets of several of these companies, with many posting Q4 2025 and Q1 2026 losses as a result of Bitcoin's dip.

Amid the broader slowdown, Strategy remains the dominant player. The firm continues to lead corporate Bitcoin accumulation, holding 843,738 BTC.

Strategy has maintained its long-term positioning while demonstrating flexibility in capital management. The company executed a $1.5 billion convertible debt repurchase earlier in the month, primarily funded through existing cash reserves and equity issuance rather than BTC sales.

Despite Strategy's strong resilience, the current environment reflects a more cautious institutional approach towards Bitcoin, including among exchange-traded fund (ETF) investors.

Bloomberg ETF analyst Eric Balchunas stated in an X post that BlackRock’s iShares Bitcoin Trust (IBIT) recorded its second-largest single-day outflows since launch, with $528 million of negative flows.

The outflows, he noted, represent only 1% of the ETF's $64 billion lifetime flows, suggesting a limited impact on the fund.

Bitcoin is trading at $75,000, down 1.1% in the past 24 hours.