1. Digital asset treasury firms face natural discounts from illiquidity, costs, and risk.
2. Premium valuations only come when crypto-per-share rises in measurable ways.
3. Larger DATs may gain a long-term advantage due to better access to leverage and markets.

A new discussion around digital asset treasury companies has taken shape after Matt Hougan, the Chief Investment Officer at Bitwise, shared a detailed breakdown of how these firms should be valued.

His explanation arrives at a time when investors are trying to understand whether DATs deserve to trade above, at, or below the value of the crypto they hold.

1/ I see a lot of bad analysis of DATs, or digital asset treasury companies. Specifically, I see a lot of bad takes on whether they should trade at, above, or below the value of the assets they hold (their so-called “mNAV”).

Here’s how I approach it.

— Matt Hougan (@Matt_Hougan) November 23, 2025

Hougan pointed out that many assessments circulating in the market rely on incomplete or incorrect reasoning, creating confusion on how fair value should be calculated.

Hougan began with a simple scenario. If a Bitcoin-backed DAT announced it would shut down within hours and distribute its holdings, its market value would match the value of its Bitcoin.

That would reflect an mNAV of 1.0. Extending that timeline to one year introduces several variables that immediately shift pricing. According to Hougan, three factors always push valuations downward: illiquidity, expenses, and operational risk.

Why Discounts Form in DAT Valuations

Illiquidity acts as the first driver. Investors do not pay the full value today for Bitcoin; they will receive it after a year. Many would demand a haircut of 5 to 10%. The second force comes from expenses. Hougan used a simple illustration.

If a DAT holds Bitcoin worth 100 dollars per share but spends $10 per share annually on operating costs and executive pay, investors would naturally insist on a 10% discount. The third factor is general company risk, including management decisions, custody safety, or compliance failures.

These elements create a baseline framework showing why discounts are the default position. They exist because each cost erodes the final value that investors would ultimately receive.

When Premiums Appear and Why Size Matters

Hougan also mentioned situations wherein DATs can potentially earn a premium rate. In the United States, it would be achievable only by increasing crypto per share. There were four methods to fund such additional sources of income.

They were to borrow money to purchase crypto, lending out assets to earn interest, investing in derivatives to earn returns, and purchasing crypto via buybacks, M&A deals, and ‘locked tokens.

However, such favorable attributes are not a certainty but are pitted against the definite costs and pain of quickly liquidating other assets. Hence, Hougan forecasts that very few effectively operated DATs will cross above asset value, while the rest will remain below.

In particular, he emphasized that large companies have large advantages because they find it easier to gain access to credit, have high liquidity, and have greater opportunities to purchase discounted securities.

Also Read: Matt Hougan Calls Solana the New Wall Street Amid Tokenization Boom