Institutional flows may favor ETH treasuries as consolidation pressures weigh on Bitcoin DATs, potentially reducing net demand across competing treasury vehicles.
Welcome to the US Crypto News Morning Briefing — your essential rundown of the most important developments in crypto for the day ahead.
Grab a coffee because the conversation around digital asset treasuries is unexpectedly shifting. Once seen as struggling vehicles weighed down by falling valuations, they may now hold the key to where institutional crypto demand flows next.
Digital asset treasuries (DATs), listed companies holding cryptocurrencies on their balance sheets, have been under pressure in recent months. This came as falling market NAVs (mNAVs) dragged share prices lower.
However, according to Geoff Kendrick, Head of Digital Asset Research at Standard Chartered, the turbulence may signal not decline but opportunity.
“Rather than signalling the end of DATs, I think this creates an opportunity for differentiation,” Kendrick said in an email.
He outlined three key drivers that will separate successful players from the rest: cost of funding, scale, and yield.
Kendrick argues that Ethereum-based DATs are best positioned to thrive. While Bitcoin DATs account for around 4% of BTC supply, Ethereum DATs hold 3.1% of ETH.
According to the Standard Chartered executive, staking yields are an added benefit for Ethereum-based DATs, giving them a structural advantage.
“We think ETH and SOL DATs should be assigned higher mNAVs than BTC DATs due to staking yield,” he noted.
Bitmine’s Tom Lee estimates that staking yield alone could add 0.6 points to Ethereum DATs’ mNAVs, bolstering sustainability.
A higher mNAV signals a business model capable of purchasing more crypto, while lower ratios raise risks of consolidation.
According to Kendrick, this process would likely mean coin rotation, not fresh buying.
In Kendrick’s view, cheap and creative financing, such as convertible debt, reported in a recent US Crypto News publication, can tilt the balance in favor of certain DATs.
Size also matters, with the largest firms tending to sustain higher mNAVs. Consolidation could accelerate this dynamic, with weaker Bitcoin treasuries potentially giving way to larger, more sustainable competitors.
Regulation adds another wrinkle. Ethereum DATs are seen as more established than Solana-based peers. This is amid reports that Nasdaq may require shareholder approval for crypto purchases.
The largest ETH DAT, BMNR, is not Nasdaq-listed, allowing it to pursue strategies pre-approved by investors.
With DATs collectively holding 4.0% of Bitcoin, 3.1% of Ethereum, and 0.8% of Solana, their strategies directly affect market flows.
Kendrick stressed that higher mNAVs in Ethereum treasuries could translate into continued ETH buying at scale. By contrast, Bitcoin DATs face headwinds, with consolidation likely reducing net demand.
“As a result, we see DATs as being a more positive driver for ETH than BTC or SOL going forward,” Kendrick said.
While DATs remain under scrutiny, Ethereum’s staking yield, established presence, and relative insulation from regulatory hurdles may put it in pole position to shape the next phase of institutional crypto accumulation.
Here’s a summary of more US crypto news to follow today:
