Bitwise executives are warning that the emerging class of digital asset treasury (DAT) companies is heading toward a period of structural repricing. Both Matt Hougan, Bitwise chief investment officer, and Hunter Horsley, the firm’s CEO, said in separate posts that most DATs are unlikely to sustain premiums above their underlying crypto holdings due to fundamental constraints.
According to Hougan, who shared a detailed thread on X, the market has seen “a lot of bad analysis” on how DATs should be valued relative to their holdings, or their so‑called mNAV. He argued that understanding whether a DAT should trade at, above, or below this metric requires treating the firm as if it had a fixed lifespan.
1/ I see a lot of bad analysis of DATs, or digital asset treasury companies. Specifically, I see a lot of bad takes on whether they should trade at, above, or below the value of the assets they hold (their so-called “mNAV”).
— Matt Hougan (@Matt_Hougan) November 23, 2025
Here's how I approach it.
“The first thing to do when evaluating a DAT is ask yourself: If this company had a fixed lifespan, what would it be worth?” he wrote. Hougan explained that in an immediate liquidation scenario, a bitcoin DAT would trade exactly at the value of its bitcoin, with no discount. But extending that horizon introduces friction.
Illiquidity, expenses, and risk create consistent discounts
Hougan identified three main factors that push DAT prices below their asset value — illiquidity, expenses, and risk.
“You wouldn't pay full price today for bitcoin you'd receive in a year,” he said, illustrating how waiting time reduces value. The second drag comes from operational costs: “Every dollar spent on operating expenses or executive compensation comes out of your pocket.” Finally, he warned about execution risk, noting that “there is always a risk that a company will slip up in some way.”
Together, these elements create a persistent discount in the market. “Most DATs will trade at a discount, and only a few exceptional firms will trade at a premium,” Hougan concluded.
Few mechanisms exist to earn a premium
On the upside, Hougan described limited ways DATs can increase their crypto‑per‑share ratio, and thus justify a premium. These include issuing debt to buy crypto when asset prices are low, lending crypto to generate interest, using derivatives like covered calls to earn yield, or acquiring digital assets or other DATs at a discount.
He cautioned that success depends on scale.
“Larger DATs will have an easier time issuing debt than smaller DATs; they will have more crypto to loan; they will have access to a more liquid options market; they will have better access to M&A and other discount deals,” he noted, predicting greater performance differentiation ahead.
CEO Hunter Horsley echoes structural limits
Horsley echoed Hougan’s comments, writing on X that the vast majority of digital asset financial companies “will likely trade at a discount going forward due to structural limitations, with only a select few capable of achieving a premium valuation.” He said liquidity constraints, operational expenses, and inherent balance‑sheet risks are likely to weigh down valuations for most firms.
“Most DATs will trade below net asset value,” Horsley posted, adding that only the most efficient companies able to consistently increase crypto value per share will outperform.
Sector consolidation and next‑phase evolution
Horsley also sees the DAT industry evolving from simple bitcoin‑holding entities into operating companies, with more active management models. He predicts a wave of acquisitions and integrations as stronger treasuries absorb smaller firms, describing it as a sign of market maturation.
“The sector is still early, and the industry is only beginning to discover what the long‑term structure of digital asset financial companies will look like,” Horsley said.
The remarks come amid mounting pressure on the segment. Industry data from DefiLlama shows DAT inflows have dropped 82% since September 2025, while leading players like Strategy (MSTR) now trade below their net asset value. Bitcoin’s 36% drawdown from its October peak has amplified liquidity stress and repositioning among institutional holders.
Horsley, however, remains cautiously optimistic, saying elite operators will emerge stronger as the market stabilizes. Hougan’s framework suggests that those capable of managing expenses, mitigating risk, and scaling effectively could be the few firms that trade at a premium, while most others settle below the value of their assets in a newly rationalized market structure.
Oleksii Shumak
Disclaimer: All materials on this site are for informational purposes only. None of the material should be interpreted as investment advice. Please note that despite the nature of much of the material created and hosted on this website, HODL FM is not a financial reference resource, and the opinions of authors and other contributors are their own and should not be taken as financial advice. If you require advice. HODL FM strongly recommends contacting a qualified industry professional.
