What to Know:
-
Nasdaq’s crackdown caused DAT stocks like MSTR and SBET to plunge.
-
New rules demand transparency, shareholder approval, and risk disclosures.
-
Future hinges on whether DATs pivot to long-term value or rely on hype.
The excitement around crypto treasury companies known as Digital Asset Treasuries (DATs) may be at risk after a major regulatory shift. Nasdaq, the U.S. stock exchange where many of these companies are listed, is tightening rules, which could put a chill on the rapidly growing DAT market.
New Rules Spark Market Drop
Nasdaq is now requiring companies that raise money to buy cryptocurrencies to first get approval from their shareholders. They also must clearly explain their investment scale, strategy, and risks. If firms don’t comply, Nasdaq may suspend trading or even delist them entirely.
Right after the announcement, several DAT stocks plunged. Shares of companies like MicroStrategy (MSTR), SharpLink Gaming (SBET), BitMine Immersion (BMNR), and BTCS fell sharply. Their market-cap to net asset value ratios dropped hard, for example, MSTR went from 3.5x to 1.3x, SBET from 3.72x to 0.82x, and BMNR nearly halved from 9.45x to 0.88x. This shows the powerful “flywheel” effect where rising crypto prices boost buyers’ sentiment has slowed considerably.
What This Means for Crypto Treasuries
These new rules affect DAT firms in three key ways:
-
More Oversight and Transparency
Companies must now disclose details like how much crypto they hold and how they’re using it. In the past, some firms faced criticism for misleading stock activity before announcements which Nasdaq wants to curb. -
Concentration Risk Grows
According to data, these treasury firms hold almost $70 billion in crypto, but most of it is held by just a few companies. Strategy and BitMine make up more than 90% of the market value. This squeeze makes it hard for smaller players to compete. -
Capital Raising Slows Down
Before, companies could quickly get more equity to buy more crypto, which kept the flywheel going. Shareholder votes and stricter approval processes now mean slower growth and fewer chances to make money through arbitrage.
Market Reactions and Broader Risks
People who support DATs say these companies have advantages over ETFs, such as better liquidity, flexible leverage, and built-in protection if crypto prices go down. Pantera and DWF Labs are two big companies that keep putting money into them.
But critics say the model is weak. Analysts like those at Glassnode suggest crypto treasury strategies are severely stretched. Franklin Templeton highlights a risk: if a company’s market value dips below its net assets, it might be forced to sell sparking a downward spiral. Some people even say that this bubble is like the dangerous mortgage-backed securities that were around before the 2007 financial crisis. The flywheel could lose speed and leave markets open if the fundamentals and risk controls aren’t stronger.
What’s Next for DATs
DATs are at a crossroads because stricter rules are coming. Companies now have a choice: they can either embrace openness, improve their governance, and build a path to long-term value, or they can keep chasing short-term profits that are driven by market hype. If they work, DATs could change how public companies safely store digital assets and connect traditional finance with crypto. But if they don’t change, investors may lose interest, prices may drop, and the market as a whole may lose faith in this model.
Final Thoughts
The Nasdaq crackdown is a serious warning that the crypto treasury boom may be hitting its limits. The rules push for accountability but also threaten many DAT firms’ fast-growth model.
These businesses might be able to make it through this shake-up if they can show that they are truly stable and valuable, not just hype. If not, the flywheel that once lifted them could stall, which would slow down what could be a game-changing time in crypto history.
Also Read: SEC Chair Highlights Clear Crypto Rules as Priority in SEC’s Spring 2025 Agenda
