What’s Happening With Crypto Treasuries? An Explanation of TradFi’s Latest Strategy

The era when cryptocurrency was only for retail investors has passed. With the emergence of crypto treasuries, institutions are now paying close attention to the market. Increasingly, publicly traded companies in the U.S., Europe, and Japan are investigating digital currencies like Bitcoin, Ethereum, and Solana, integrating them into their financial statements.

Digital Asset Treasury Companies (DATCOs) are transforming the way traditional investors, especially those with a preference for stocks, access the rapidly growing crypto markets. As of mid-August 2025, the overall trading market was valued at over $4 trillion. This amount is projected to rise as Wall Street and government entities become more accepting of the sector. In the United States, the goal is to regulate crypto asset, with the passage of the GENIUS Act in July being a significant step forward.

Nevertheless, as cryptocurrencies gain traction and companies start adopting some of the top cryptos to buy, the question arises: are crypto treasuries viable? What potential risks must be taken into account? Is the industry destined for a linear ascent to the moon?

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The Emergence of Crypto Treasuries

When Michael Saylor of MicroStrategy, now known as Strategy, started acquiring Bitcoin in 2020, he faced significant criticism. BTC was struggling, and the COVID pandemic was wreaking havoc on global financial markets.

It was revealed that by purchasing BTC ▲1.27% through debt, MicroStrategy served as a stand-in for traditional finance (TradFi) investors looking for indirect exposure to cryptocurrency.

When Bitcoin USD and crypto values surged in 2021, peaking at $69,000, the MSTR stock mirrored the movement of BTC, and became one of the highest-performing securities.

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Since then, the idea has gained tremendous traction. A recent report from Galaxy Digital indicated that DATCOs collectively control over $100 billion in crypto holdings. The majority of public corporations favor BTC and Ethereum, avoiding even the emerging 1000X cryptocurrencies.

Per Galaxy Digital, public companies, spearheaded by MicroStrategy, possess nearly 800,000 Bitcoin, while those opting for ETH long-term holding over 1.3 million Ethereum. Companies willing to accept greater price swings have exposure to SOL ▲14.81%, Bittensor, BNB, and even Hyperliquid.

The allure of DATCOs lies in their capacity to provide investors with crypto exposure without the need to directly hodl fluctuating assets.

As noted by Pantera, a venture capital firm focused on crypto asset, in a recent letter, DATCOs can produce a yield to increase net asset value per share. They enable investors to accumulate more of the associated crypto token over time compared to simply holding crypto directly.

This advantage is particularly pertinent for public companies that maintain tokens from proof-of-stake networks such as Solana and BNB, which offer annual locking tokens rewards. In contrast to non-yielding spot crypto ETFs like BTC, owning shares in a publicly traded company with crypto assets leads to improved yields.

Examples: Pantera, World Liberty Financial

Recognizing this benefit, Pantera has invested over $300 million into public firms holding cryptocurrencies on their balance sheets.

These investments include SharpLink Gaming, which has rapidly acquired ETH, DeFi Development Corp, and BitMine Immersion. BitMine Immersion holds 1.15 million Ethereum, making it the largest ETH treasury globally. Meanwhile, Decentralized finance Development Corp is deeply invested in Solana, with 1.3 million SOL in its possession and raising $165 million in July 2025 to acquire more SOL.

World Liberty Financial, affiliated with the Trump family, plans to raise $1.5 billion to repurchase its coin, WLFI, through ALT5 Sigma. By buying back tokens, World Liberty Financial is following the strategy of MicroStrategy, using a public corporation to broaden crypto access.

In addition, another company owned by Trump, Trump Media & Technology Group, is making a shift, planning to add $2 billion in BTC to its balance sheet.

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Are Crypto Treasuries Viable?

Despite their attractiveness, can crypto treasuries sustain themselves? Is the DATCO model strong enough to endure the volatility of digital currency?

Public companies incorporating cryptocurrencies like ETH, SOL, and BNB into their balance sheets can benefit from staking yields, which provide greater returns through non-dilutive earnings. DATCOs also allow conventional investors to gain indirect access to cryptocurrency via familiar equity markets across various regions.

By incorporating crypto asset, companies can diversify their assets, thereby reducing risks in the event of a stock market downturn.

Nonetheless, DATCOs frequently trade at a premium, and Galaxy Digital cautions that a drop in this premium could lead to significant declines, particularly for companies that use debt to acquire cryptocurrencies.

Moreover, there are lingering risks. Changes in regulations could hinder the operations of DATCOs or their capabilities to raise funds effectively. Intense volatility in the crypto asset crypto market might deplete treasury values, affecting stock prices and undermining investor confidence. A decline in prices could also complicate efforts for companies to gather funds to purchase crypto unless investors possess strong conviction in the cryptocurrencies involved.

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