What is a DAT?

Digital Asset Treasury (DAT) companies are publicly traded firms that hold significant cryptoassets on their balance sheets, allowing investors to gain indirect exposure through traditional stock purchases. Pioneered by Michael Saylor’s Strategy (formerly MicroStrategy), the DAT model proliferated, with over 200 public companies now employing variations of it. Investors favor DATs for regulatory compliance and potential leveraged returns, as these firms often use debt to fund crypto purchases. DATs differ from ETFs because they are actively managed companies aiming to continually accumulate crypto, whereas ETFs passively track the underlying asset's price. DAT performance is gauged by Net Asset Value (NAV) and its multiple (mNAV); a premium (mNAV > 1.0) allows DATs to issue new shares via At-the-Market (ATM) programs to buy more crypto in an accretive dilution cycle. Key risks include premium collapses during market downturns, forcing stock buybacks that may require selling assets, potentially leading to a 'death spiral' if confidence erodes. Currently, over 200 DATs hold more than 1 million BTC, with Ethereum and Solana also being significant holdings.

(Source：The Block)