Shares of live streaming and e-commerce company GD Culture Group fell 28% on Tuesday after announcing a share trade to acquire all assets from Pallas Capital Holding, which includes 7,500 Bitcoin.
GD Culture will issue approximately 39.2 million shares of common stock in exchange for all Paras Capital assets, including $875.4 million worth of Bitcoin (BTC), the company said Tuesday. The transaction took place last Wednesday.
Xiaojian Wang, CEO and Chairman of GD Culture, said the deal would “directly support” the plan to build a “strong and diversified cryptocurrency reserve” while benefiting from the growing institutional acceptance of Bitcoin as a protected asset and valuable reservoir.
The company uses artificial intelligence to create fake people and runs live streaming and e-commerce businesses via Tiktok. The acquisition will become the 14th largest publicly listed Bitcoin holder, joining the trends of companies acquiring cryptocurrency.
The so-called Bitcoin treasury firms rose sharply in 2025, with over 190 publicly listed companies currently holding assets, rising from under 100 at the beginning of the year. The market has grown to $112.8 billion, with Michael Saylor’s strategy dominating a 68% share.
However, momentum has recently declined as some investors worry that the strategy of raising capital, converting it to Bitcoin and waiting for gratitude may not be sustainable.
GD Culture Stock Tank
Shares in GD Culture Group (GDC) fell 28.16% to $6.99 on Tuesday. Stocks recovered slightly in after-hours trading, up 3.7%.
It marked the biggest decline in GDC in over 12 months, sinking its market capitalization to $117.4 million. Our shares are 97% off, a record high of $235.8, set on February 19, 2021.
Diluting the stock of a company often triggers a negative market response, as it reduces the proportion of ownership of existing shareholders.
Vaneck warned on June 16 that if stock prices fall, companies that fund Bitcoin purchases through stock issuance or debt could face capital erosion, as the value of their Bitcoin holdings may not be sufficient to support new investments without hurting existing shareholders.
Related: The Eye of China Bitcoin Finance Company sells $500 million in stock for BTC
“Risations are emerging as some of these companies raise capital through large market (ATM) programs to buy BTC. If the stock is trading (net asset value) in or near NAV, continuous stock issuance could dilute rather than create value.”
GD Culture Set Bitcoin, May Trump Meme Coin Aim
GD Culture announced its cryptocurrency strategy in May when it said it was planning to sell up to $300 million of common stock to invest up to $300 million in common stock in Crypto, including Bitcoin and President Donald Trump’s official Trump (Trump) tokens.
The stock offering was announced for more than a month after the company received a non-compliance warning from NASDAQ related to shareholders’ equity below a minimum of $2.5 million.
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