Crypto Treasury Model Falters as Stock Premiums Normalize
The crypto treasury model is losing its appeal as stock premiums normalize. A report from DWF Ventures found that among the 20 largest Digital Asset Treasury (DAT) companies, only four trade above their holdings' value.
The report analyzed the market value of these companies compared to the value of their cryptocurrency holdings using a measure called mNAV. The findings suggest that investors are no longer willing to pay a premium for DAT stocks, which is a crucial aspect of the strategy's appeal.
DWF Ventures attributes this shift in investor behavior to changing market conditions. They point out that earlier demand helped these stocks command premiums, but current discounting suggests capital markets participants are less willing to pay extra for crypto exposure through a treasury structure rather than simply owning the underlying asset.
Sequans Communications, a French semiconductor company, has recently exited its Bitcoin treasury position entirely by selling its remaining 314 BTC. This move illustrates how companies may unwind when the model stops working.