The Funding: What is the real test for DATs after the crypto rally?

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The recent crypto rally has also led to a rebound in the stock prices of digital asset treasury companies, or DATs. Higher token prices increase the value of treasury holdings, improve balance sheets and can reopen access to capital. But is that enough for DATs to become sustainable?

The real question is whether DATs have actually improved on the original model, or are simply benefiting from higher token prices and issuance, said Mike Bucella, co-founder and managing partner at Neoclassic Capital.

Bucella said investors should examine which DATs are turning their treasuries into productive capital by generating staking, lending, market-making or options income, operating network infrastructure, or supporting underlying businesses with recurring revenue. "The real test is whether that income can cover opex [operating expenses], interest and dividends without selling tokens or constantly issuing stock," Bucella said.

Based on their activity, Bucella said some DATs could become "genuine crypto operating companies," while others may remain "leveraged token wrappers" that face pressure when their premiums disappear.

Beyond token prices

Several other investors and industry participants made a similar point. The rally helps, but it does not by itself prove that DATs have become stronger businesses.

Kyle Samani, co-founder and former managing partner at Multicoin Capital and chairman of Solana treasury company Forward Industries, said all DATs benefit from higher token prices in the short term, especially those that use treasury assets as collateral or rely on staking income to fund operations. But over the long term, he said DATs with the strongest balance sheets and capital structures are likely to deliver the most value.

Samani said Forward’s model focuses on using SOL staking yield to grow SOL per share and dollar-denominated yield to run the company. A genuine crypto operating company, in his view, should offer investors something they cannot easily get by simply holding, staking or getting leveraged exposure to the underlying token themselves.

A Forward spokesperson pointed to the company’s "SOL plus plus" strategy. Forward aims to compound and grow SOL per share, generate dollar-denominated revenue to offset costs and invest in Solana protocols and businesses. The spokesperson noted that the company was compounding SOL per share at a 36% annualized rate as of June 30, had added close to 1 million SOL since inception and co-led Solana-based onchain reinsurance protocol OnRe’s Series A while also allocating about $25 million into the protocol.

"We've also been active in the DAT M&A space, and will share more details publicly as things develop," the spokesperson said.

Mathijs van Esch, general partner at Maven 11, said some DATs are starting to use their crypto treasuries more productively, though the sector is still early. Larger DATs can have more influence in their underlying ecosystems, he said.

Richard Galvin, executive chairman and chief investment officer at Digital Asset Capital Management, said the crypto rebound also reflects how oversold some quality DATs had become during the downturn. He said some vehicles were trading below 0.3 times market to net asset value, or mNAV, while holding unlevered positions in tokens his firm viewed as attractive.

Galvin said passive DATs can still make sense if the discount is wide enough. More broadly, though, some treasury companies are starting to build operations that generate cash flow and add value to the ecosystem their main asset is part of, he said. Digital Asset Capital Management holds StablecoinX (USDE), which holds Ethena's ENA, and SVRN (SVRN), which manages a treasury for NEAR Protocol's NEAR, he noted.

Steve Lee, Neoclassic Capital’s other co-founder, said investors have become more selective after the downturn. They now expect more transparency around operating activity, capital allocation and forward guidance, including specific action plans and measurable targets, similar to what they would expect from a traditional listed company.

“Many DATs launched during the 2025 boom without sufficiently developed long-term plans,” Lee said.

Lee expects the DAT sector to gradually split. Some companies may develop more disciplined capital allocation strategies and operating capabilities, while others may remain mainly listed token proxies, he said.

The income challenge

Lucas Kozinski, founder of Renzo Labs, the team behind the crypto restaking protocol, was more skeptical. He said the recent rally masks a key distinction, because most DATs still rely on token price appreciation rather than model innovation.

A genuine crypto operating company should generate organic, non-dilutive cash flow to accumulate assets, Kozinski said. A leveraged wrapper, by contrast, relies on capital markets or passive holding mechanisms.

Kozinski said staking rewards may increase token balances, but they are paid in kind and mainly offset protocol inflation rather than generating new capital. To create real economic returns, DATs would need to deploy their balance sheets more actively, such as through DeFi or structured collateralized lending, he added.

That also adds risk. Kozinski said recurring income can come from off-chain capital allocation or on-chain yield strategies, but both carry their own risks. Institutional over-the-counter lending can expose DATs to counterparty defaults, while basis trading, liquidity provision and DeFi money markets carry smart contract and protocol execution risks, he said.

Until DATs build stronger risk management systems, most will likely stay cautious rather than chase yield, Kozinski added.

Kozinski said investors should track crypto-per-share growth and then ask where that growth comes from. Growth driven by premium equity issuance or debt depends on capital markets staying open, while growth from operating or yield income is more self-sustaining, he said. He also watches mNAV as a gauge of whether the equity issuance model can keep working, and debt-to-NAV as a measure of forced-seller risk.

Lex Sokolin, co-founder and managing partner at Generative Ventures, also said DATs remain mostly financial engineering today. He described them as “embedded leverage bets” on the underlying cryptocurrency, structured to concentrate ownership of that asset through share issuance, buybacks, staking and DeFi strategies.

"On the onchain side, DATs can use staking and DeFi to accelerate the use of their tokens for yield. In reality, you can get only a bit over the risk free rate without starting to get into real leverage and risky looping," Sokolin said.

Sokolin said DAT stocks trade like leveraged tokens, shaped by retail narratives and how well management communicates. Anything below $1 billion in enterprise value may also struggle with fixed operating costs, retaining talent and staying focused, he said.

The more interesting model, Sokolin said, is not simply concentrating token ownership, but generating alpha within an ecosystem. Longer term, he said DATs should look more like ecosystem foundations, but for now the sector remains mostly financial engineering "with some special situation investments into distribution and marketing."

Kozinski said the clearer signal would be DATs trading durably above 1x mNAV, not just rising with the underlying crypto market. "The market has yet to see DATs transition into true operating entities by actively deploying balance sheets, whether through DeFi integration or structured collateralized lending, to capture real economic returns," Kozinski said.

Cosmo Jiang, general partner at Pantera Capital, offered a simpler view. "The single most important driver of DAT performance is the underlying token price, which has a reflexive impact on the multiple as well," Jiang said. "Anything more than that is overintellectualizing what is a very straightforward business model."

Galvin expects consolidation, saying the market likely does not need more than one DAT for each underlying token and that passive DATs will become harder to justify as direct token ownership continues to become easier.

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