DATs Keep Buying Bitcoin, Outperforming ETFs Is the Hard Part

“Just buy an ETF.” That blunt advice from Strive Asset Management CEO Matt Cole during a panel at Hong Kong’s Bitcoin Asia in August summed up the growing frustration with Digital Asset Treasuries (DAT), the corporate vehicles that promise to outperform bitcoin BTC$112,509.80 through clever financing and balance-sheet engineering but, so far, struggle to make good on that pledge.

Bitcoin itself is up about 23% this year. Yet, most Digital Asset Treasuries, including MicroStrategy, Semler Scientific, GameStop, and Trump Media, have badly trailed both BTC and the ETFs tracking it. Only a few outliers, like Twenty One Capital and Japan’s Metaplanet, which has been prone to volatility, have managed to beat the benchmark.

That gap exposes the core weakness of the DAT trade. These companies were built to outperform BTC through leverage, financing, or operational alpha, but most are lagging the simplest possible exposure.

The pitch of levered beta with balance-sheet discipline only works when equity premiums, convertibles, and debt markets stay friendly. Think about how toxic Strategy’s $8 billion in debt would look if there were a rate hike. With an average coupon of just 0.42% and maturities stretching over four years, those bonds look manageable today, but that comfort vanishes in a higher-rate world.

Even though the headlines come through daily about crypto entrepreneurs taking over a shell company and pumping its balance sheet full of BTC, the warnings are growing louder and louder.

Galaxy Digital has warned that the entire structure depends on a persistent premium to net asset value, a reflexive setup reminiscent of the 1920s investment-trust boom. NYDIG has been just as critical, arguing that the industry’s favored “mNAV” metric masks liabilities and inflates per-share exposure by assuming debt conversions that never happen.

None of this means corporate bitcoin adoption is a mirage; it’s growing faster than ever. There are almost 40% more public companies holding bitcoin today than there were three months ago, according to data compiled by Bitwise.

Some of these companies are real firms that have BTC on the balance sheet because of the nature of their industry, like Coinbase, Bullish (Bullish is the parent company of CoinDesk), or BTC miners like MARA. Others have it as a hedge against fiat instability.

But, so many companies on Bitwise’s list are BTC DATs, and it’s important to differentiate these from other DATs that list proof-of-stake altcoins like ETH or Solana. This is a different offering.

By staking native assets and operating validators, these DATs earn yield not from leverage but from network activity itself. For instance, owning an ETH or TRX DAT would get exposure to Ethereum or Tron – the networks that the stablecoin revolution live on. In theory, this exposure turns treasuries into miniature ecosystems, compounding value as the network scales.

Tron’s listco, SRM, now Tron Inc after a rocky start, is showing how this is done. Nearly half of USDT activity lives on Tron, so if investors want a ‘Visa moment’ for USDT – especially in the most exciting markets for stablecoins like Latin America – Tron Inc is a DAT that fits this bill.

Still, that kind of on-chain exposure remains the exception, not the rule. Most DATs haven’t figured out how to translate balance-sheet size into operational yield or network participation. They were supposed to be smarter than ETFs, capital-efficient, yield-bearing, and tied to the real economic flow of blockchains, but many remain little more than leveraged proxies for bitcoin beta.

Until more treasury firms can prove they can compound capital faster than a passive ETF, the simplest takeaway from the Hong Kong stage might remain the best one: just buy the ETF.