Bitwise CIO Matt Hougan on Digital Asset Treasuries (DATs)
Bitwise Chief Investment Officer Matt Hougan shares his perspective on the evolving landscape of Digital Asset Treasuries (DATs), emphasizing that only those executing complex and value-enhancing crypto strategies deserve market premiums as market net asset values (mNAVs) decline.
Market Trends in DAT Valuations
There has been a notable revaluation in the DAT sector, with most firms’ mNAVs converging around 1.0. Hougan highlights that some DATs should trade at or above their net asset value (NAV), while others justify trading at or below it.
Criteria for Evaluating DATs
Hougan suggests the key question investors should ask is whether a DAT is performing something challenging:
“Are they doing something hard?”
He differentiates between firms that simply buy and hold crypto assets and those that actively build complex financial frameworks or strategic models around their assets.
Buy-and-Hold vs. Strategic Execution
According to Hougan, simply acquiring crypto assets and holding them on a balance sheet is no longer difficult, especially with ETFs offering staking options that provide similar exposure but with less effort.
MicroStrategy as a Leading Example
He identifies MicroStrategy (now known as Strategy) as a prime example of a DAT executing a complex yet rewarding strategy. This company currently holds $66.22 billion in Bitcoin backed by $8 billion in debt, and it is borrowing against that position.
"It is challenging to raise that much in equity capital to buy Bitcoin in a corporate structure, particularly when debt-free."
Conclusion
Hougan’s insight clarifies that gaining market premiums depends heavily on the difficulty and sophistication of a DAT’s strategy, rewarding those that innovate and manage risk effectively.
Author's summary: Matt Hougan stresses that only Digital Asset Treasuries executing complex strategies, exemplified by MicroStrategy, deserve market premiums as simpler buy-and-hold DATs face downward valuation pressure.