Geoff Kendrick, the global head of digital assets research at Standard Chartered, has expressed serious concerns about the viability of digital asset treasury companies (DATs) amid declining market-to-net asset values (mNAVs). The source notes that his insights highlight the critical threshold that DATs must maintain to ensure their continued operation and influence in the cryptocurrency market.
Importance of mNAV for DATs
Kendrick emphasized that for DATs to remain active in purchasing underlying assets, they must keep their mNAV above 1. This metric is crucial as it reflects the health and sustainability of these companies in the volatile digital asset landscape. With DATs holding substantial amounts of
- Bitcoin
- Ethereum
- Solana
, their financial performance could significantly impact the market prices of these leading cryptocurrencies.
Sustainability of Ethereum DATs
Among the various digital assets, Kendrick pointed out that Ethereum DATs are positioned with the highest likelihood of sustainability. This is largely due to their ability to generate yield through staking, a feature that Bitcoin DATs lack. As the market continues to evolve, the performance of these treasury companies will be closely monitored, as their stability could play a pivotal role in shaping the future of digital asset investments.
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