Crypto treasury model loses its edge as stock premiums fade: DWF
Most DATs now trade below the value of their crypto holdings, weakening a financing model that once helped companies expand their balance sheets.
A new report from DWF Ventures reveals that the DAT (Digital Asset Treasury) model is losing its edge as stock premiums for companies holding crypto diminish. Most DATs, which trade below the value of their crypto holdings, no longer command the capital raising premiums that initially fueled their growth. Only four of the 20 largest DATs, including Bit Digital, Strive, Hyperliquid Strategies, and BitMine, are currently trading above an mNAV (market value) of 1, meaning their market value exceeds the value of their crypto holdings.
This widespread discount suggests investors are no longer willing to pay the same premium for crypto exposure through publicly traded companies. The report highlights that, despite the initial promise of DATs, most have underperformed compared to simply holding the underlying cryptocurrency. Some companies, like Sequans Communications, have already exited their Bitcoin treasury strategies, selling off their remaining crypto assets to complete an exit that began in May.
The premium investors once paid for DAT stocks peaked during the strategy's early success, particularly during Bitcoin's 2024 rally. However, as Bitcoin's value has declined, the DAT model has become increasingly challenging to sustain. Analysts warn that a collapse in the mNAV could lead to consolidation among DAT companies, as the model's financing mechanism relies on a persistent equity premium to NAV.
Written by urgent.news from Cointelegraph's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
