Bitwise’s Matt Hougan believes that bigger DATs acquire main benefits in debt markets, lending capability, derivatives entry, and M&A alternatives.
Bitwise Chief Funding Officer Matt Hougan outlined a valuation framework for digital asset treasury corporations (DATs) and stated that evaluation of the sector typically misunderstands how these corporations needs to be priced relative to the belongings they maintain.
In a sequence of posts, Hougan stated the core query for valuing any DAT is to think about what the corporate can be price if it had a set lifespan.
Illiquidity, Bills, and Threat
He defined {that a} Bitcoin-focused DAT asserting a same-day shutdown and distribution of its holdings would commerce precisely on the worth of its bitcoin, or an mNAV of 1.0, whereas extending the liquidation timeline to at least one 12 months introduces circumstances that may push valuations above or under the underlying asset worth.
Hougan stated three important components justify a reduction to mNAV: illiquidity, bills, and threat. Illiquidity displays the cheaper price traders would pay right this moment for Bitcoin they might obtain in a 12 months, and Hougan means that the low cost might be 5-10%. Bills immediately cut back investor worth, and a DAT holding $100 price of BTC per share however paying executives $10 per share per 12 months would warrant a corresponding 10% low cost. Threat, outlined as the potential of operational errors or different failures, should even be factored into pricing.
On the opposite aspect, the Bitwise exec stated DATs might commerce at a premium provided that they’re rising their crypto-per-share, and famous that within the US, that is the only real motive for such a premium. He recognized 4 methods DATs use to perform this: issuing USD-denominated debt to purchase crypto, lending out crypto to earn curiosity, utilizing derivatives similar to writing name choices to generate further revenue, and buying crypto at a reduction.
Discounted acquisitions can happen by way of buying locked belongings from foundations looking for liquidity, buying one other DAT buying and selling under its asset worth, repurchasing its personal discounted shares, or shopping for a cash-flow-generating enterprise and allocating the proceeds to crypto.
“Excessive Hurdle”
Hougan added that low cost components are typically sure whereas premium-enabling components are typically unsure. This finally ends up creating what he described as a excessive hurdle for many DATs. Because of this, he stated most corporations will commerce at a reduction, with solely a restricted variety of robust performers buying and selling at a premium. Utilizing the instance of a Bitcoin DAT scheduled to liquidate in 12 months, he stated truthful worth might be estimated by calculating bills, including a threat low cost, and offsetting these with expectations for will increase in bitcoin-per-share.
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Though DATs don’t have mounted lifespans in apply, the exec stated this extends moderately than adjustments the mannequin, as a result of bills and dangers compound over time, whereas corporations that may develop crypto-per-share constantly might turn out to be extremely precious.
He additionally stated bigger DATs have structural benefits, together with simpler entry to debt markets, bigger swimming pools of crypto for lending, deeper choices markets, and broader alternatives for mergers, acquisitions, or different discounted offers. Whereas DATs have largely moved in tandem over the previous six months, Hougan expects larger divergence forward, with a small variety of corporations executing properly sufficient to commerce at a premium and plenty of others buying and selling at a reduction.
In the meantime, DAT corporations have invested a minimum of $42.7 billion into crypto acquisitions in 2025, in line with CoinGecko’s current report. It was discovered that $22.6 billion was deployed within the third quarter alone, which makes it the strongest quarter on document for accumulation. Altcoin-focused DAT corporations accounted for $10.8 billion, or 47.8%, of Q3 spending, however Bitcoin-focused corporations continued to dominate total exercise.
Because the begin of 2025, Bitcoin DAT corporations have bought greater than $30 billion in BTC, which represented 70.3% of whole acquisitions. Ethereum counterparts adopted with $7.9 billion in purchases, most of it in August, whereas SOL, BNB, WLFI, and different belongings made up 11.2% of annual spending.
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