Digital Asset Treasury (DAT) Report, Volume 2: How to Build One and How to Invest in One
HASHKEY CAPITAL
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A Digital Asset Treasury (DAT) is a type of publicly listed company whose core strategy is to hold digital assets. In Part 1 of this series, we introduced DAT’s basic concept, operating model, and defining features. This second installment addresses two questions:
From an operator’s perspective, how do you build a DAT?
From an investor’s perspective, how do you select high-quality DAT companies?
1. How to Build a DAT
From the operator’s standpoint, there are two main paths to establishing a DAT:
An existing company proactively purchases digital assets to pursue a strategic transformation similar to what firms like Microstrategy and Tesla are doing. The process generally includes board approval, treasury-management policy updates, engagement of qualified custodians, and public disclosure to investors.
A new listed digital asset company can be established through capital market transactions such as reverse takeovers (RTOs) or SPAC/backdoor listings.
Whichever path is taken, the company must plan sensibly around asset allocation and market strategy/listing venue selection.
1.1 Proactive Purchases / Strategic Transformation
Some companies transition into a DAT due to strategic, business, or financial considerations. Early DAT examples — such as MicroStrategy (later renamed Strategy) — largely fall into this bucket. In 2020, under the CEO’s leadership, Strategy launched a Bitcoin reserve strategy that drove its market capitalization from USD 1.436 billion to USD 112 billion by 2025. Similarly, Japan’s Metaplanet, originally in the hotel business, announced in April 2024 that it would adopt Bitcoin as its primary reserve asset.
Successful transitions of this nature are often driven by a controlling management shareholder and subsequently endorsed by the board and shareholders. Accordingly, any listed company considering a shift toward a DAT-style model should carefully evaluate how its core business aligns with a digital asset–holding strategy for additional synergies, while also assessing shareholder backing and the associated accounting and tax implications.
1.2 Using a Shell Company
Today, many DAT projects/companies are established via approaches such as reverse takeovers (RTOs), de-SPAC mergers, and PIPE capital injections. Several aspects in this process merit attention from DAT teams.
1.2.1 Choosing the Target
An ideal shell should be listed in a suitable market, be cost-effective to acquire, have no significant legacy liabilities, and have a shareholding structure that allows control without breaching listing float rules. Preferably, its share price has been depressed yet stable — especially without recent spikes — and a smaller share count eases future issuance subject to minimum public float. Concentrated ownership reduces friction with the original team and board. Prior disclosures related to crypto are a plus, as they link the business to a future DAT narrative and can smooth regulatory review.
Different markets have unique traits and regulatory barriers. In the U.S., there are small-cap shells on Nasdaq and the OTC markets, but one must screen for hidden debt or legal issues. Reverse-merger shells exist but carry elevated liability and disclosure risks. Hong Kong Main Board listed companies tend to be pricier, have a sustainable business model and operate under stringent regulation; GEM (Growth Enterprise Market) listed companies often have lower liquidity. Currently, the Hong Kong market is gradually rolling out new investment opportunities, such as the launch of a Solana spot ETF, but DAT companies still face severe regulatory resistance in Hong Kong. Japan has fewer shell opportunities, and where available, they are subjected to Tokyo Stock Exchange rules regarding number of shareholders, tradable shares, and market capitalization.
1.2.2 Choosing the Mechanism
Financing can take multiple forms, including RTO, de-SPAC, and PIPE.
RTO
RTO (Reverse Takeover) is one of the most common shell routes. It refers to a private company being acquired by a listed “shell company,” thereby achieving an indirect listing. The key is to find a listed entity that is compliant and either no longer operates its core business or whose core business can be wound down. For teams aiming to build a DAT, RTO offers several advantages:
Rapid access to listed status, skipping the lengthy IPO review
Often lower valuations, making it cheaper to obtain control
But there are also risks and drawbacks:
The shell may carry historical baggage, financial issues, or a complex cap table
Limited initial financing capacity, requiring follow‑on PIPE placements
Compliance risks, as both U.S. and Hong Kong markets have recently tightened scrutiny on RTOs. In addition, if the exchange deems the new share issuance in an RTO to constitute a reverse acquisition, the deal must be reviewed under new‑listing standards.
de‑SPAC
de‑SPAC refers to merging with an already listed Special Purpose Acquisition Company (SPAC) to achieve the target company’s listing. Because the SPAC passes listing approval at the IPO stage, the de‑SPAC process focuses more on disclosure and shareholder voting, with review emphasis on transaction fairness and sufficiency of disclosure rather than rerunning the full IPO gauntlet.
Advantages include:
Review is relatively simpler versus IPO
SPAC cash/commitments provide valuation anchors
Risks include:
A SPAC must complete its de‑SPAC within its effective period, typically 18–24 months, or return funds to IPO investors, creating a time‑window constraint
For an RTO or de-SPAC, you need a reasonable valuation anchor. A credible valuation anchor is essential to support negotiations and regulatory review. In practice, valuation is based on the fair market value of the combined business or injected digital assets, verified by independent experts where required. A reasonable premium may be applied to reflect the combined group’s future capital-raising potential and growth prospects, thereby aligning incentives between new and existing shareholders. Lock-ups for legacy shareholders help prevent immediate selling post-reorganization that could pressure the stock.
PIPE
Beyond RTO and de‑SPAC, financing can also be done via a shell company’s PIPE (Private Investment in Public Equity). PIPE places new shares with a limited set of qualified investors. Its advantages include:
A process similar to RTO but more streamlined, with directed issuance approved by shareholder vote, while taking care not to issue to a controlling level
Greater flexibility and generally lower frictional costs
The main risks and drawbacks lie in careful design of PIPE structures and discounts to avoid excessive dilution pressure on the share price.
A PIPE (Private Investment in Public Equity) introduces strategic investors through a board-approved private placement of shares or convertible instruments to specific investors. Unlike a Reverse Takeover (RTO), a PIPE is primarily a financing mechanism rather than a change-of-control event, and it is generally more streamlined procedurally — provided the issuance does not necessarily result in change in effective control unless that outcome is intended.
1.2.3 Choosing Partners
Standing up a DAT typically involves multiple counterparties:
Investment Banks
Key partners that source shells (and conduct due diligence), locate PIPE investors, and advise on execution. Prior experience and familiarity with shell resources are important selection criteria.
Placement Agencies
Focus on private placement transactions, especially central in PIPE deals. Typical responsibilities include introducing qualified investors, helping set financing terms such as lockups, redemption, and discounts, and coordinating legal disclosures and regulatory filings.
PIPE Investors
Lead investors often seek control rights and a say in operations. The first PIPE greatly shapes a DAT’s initial trajectory, so it’s crucial to bring in strategic institutions aligned with the DAT’s thesis.
Asset Managers
Responsible for executing the DAT’s digital asset portfolio, including purchases, on‑chain staking, and yield strategies. Projects can build in‑house teams or outsource to managers with on‑chain execution and custody capabilities.
Custodians
Safekeep the DAT’s crypto assets, enforce signing‑authority segregation, and provide on‑chain address attestation. They must also meet audit requirements and compliance standards such as SOC 2.
Legal Counsel
Core advisors for structuring the DAT strategy. They help interpret securities‑law boundaries, draft financing documents for PIPE and other tools, and complete exchange disclosure documentation.
Auditors
Play the audit role in the DAT model, covering fair‑value measurement of assets, NAV/mNAV and related financial disclosures in annual and quarterly reports. They are critical to ensuring digital assets are accounted for compliantly on the balance sheet and that corresponding audit opinions are provided.
1.3 Asset Allocation
A DAT’s asset allocation strategy determines its risk–return profile, market narrative, and ongoing fundraising capacity.
Core assets: BTC/ETH/SOL
Bitcoin is “digital gold” with inflation-hedging and store-of-value attributes — often the base allocation for DATs.
Ethereum offers growth potential plus staking yield, providing a more predictable return stream.
SOL, BNB, and others have drawn some DAT allocations in 2025 due to performant base chains, vibrant ecosystem, and efficient operating teams.
Most DATs concentrate in one major asset to craft and reinforce a clear brand and core narrative for investors (e.g., Strategy ↔ Bitcoin, BitMine ↔ Ethereum). Multi-asset DATs — with more flexible rebalancing — can mitigate single asset risk and may gradually emerge and capture share.
Pros of major-cap allocations: mature playbooks and lower risk vs. smaller tokens.
Cons: more competitors, tighter fundraising conditions as the theme gets crowded.
1.4 Venue and Market Comparison
The DAT model has spread from the U.S. to Asia and Europe, but market environments vary widely. Companies should choose a listing venue based on financing tools, regulatory framework, investor base, and liquidity. Below we compare the U.S., Hong Kong, and Japan across these four dimensions.
1.4.1 United States
The U.S. is DAT’s core market — characterized by diverse financing tools, mature capital market infrastructure, strict disclosure regime, and high volatility and valuation elasticity.
Listing & Issuance Tools
U.S.-listed DATs have broad financing flexibility. They use at-the-market (ATM) equity programs, larger follow-on equity offerings, large convertible note issuances, and — more recently — perpetual preferred stock structures to raise billions of dollars and purchase additional crypto assets. For example, Strategy issued four series of preferred stocks and multiple convertibles notes within a short span, raising billions of dollars. In bull markets, these tools let U.S. DATs quickly “reload” and scale holdings.
Regulatory Framework
The U.S. has robust disclosure rules. Listed firms must promptly disclose significant crypto purchases, financing, and risk factors around crypto concentration, liquidity and custody of assets. Custody and AML standards are high; DATs generally use regulated custodians and adhere to OFAC/FinCEN requirements when conducting capital raises. The Financial Accounting Standards Board (FASB) issued ASU 2023–08, which requires in-scope crypto assets to be reported at fair value, with unrealized gains and losses flowing through earnings and enhanced footnote disclosure. The standard becomes mandatory for fiscal years beginning after December 15, 2024 (effectively 2025 reporting), with early adoption permitted in 2024. Economically, these vehicles give investors indirect crypto exposure through a U.S.-reporting, exchange-traded equity wrapper, which many institutions and family offices can hold more easily than spot tokens.
Investor Base
A mix of institutions and retail. Hedge funds and family offices view DATs as new vehicles for crypto exposure; retail investors are driven by momentum and narrative The U.S. risk appetite is high with established leverage and shorting mechanisms — as such, DAT stocks often show greater volatility than the cryptocurrencies themselves.
Liquidity
Deep market leaders like MSTR trade heavily; options and broad market coverage add further liquidity. This aids continuous capital raising via ATMs and follow-on offerings but also makes prices highly news sensitive. Market makers and quantitative funds provide liquidity that helps dampen short-term volatility and facilitate smoother capital raising through ATMs and follow-on offerings.
Overall, the U.S. offers the highest valuation ceiling and financing convenience, alongside higher volatility and regulatory scrutiny.
1.4.2 Hong Kong
Hong Kong is a global financial center with transparent regulation and an international investor base — an important bridge for DAT’s expansion into Asia.
Listing & Issuance Tools
Main Board issuers can conduct board-authorized placements (generally ≤20% of issued shares) without convening a shareholder meeting each time. Recently, several Hong Kong–listed companies like Boyaa Interactive have used placements and top-up placings to raise capital specifically for digital asset or crypto-related expansion after market rallies.
Regulatory Framework
Regulators are supportive of virtual asset activity but apply caution. Corporate crypto purchases are permitted with adequate disclosure, compliant funding sources, and AML/CFT adherence, robust custody, and continuing business substance under Rule 13.24. Under IFRS, holdings are treated as intangible assets: impairments are recognized but unrealized gains are generally not. Thus, HK DATs typically provide market value of holdings in the notes to aid investor assessment.
Investor Base
Mix of local and global capital. International hedge funds/family offices can access DAT exposure via HK equities; Mainland investors can participate through Stock Connect (though some small caps are excluded). Compared with the U.S., HK investors emphasize fundamentals and long-term story, so local DATs often highlight ongoing sustainable business operations beyond just a treasury model adhering to Rule 13.24. Exchanges may request clarification announcements on sharp moves to curb speculation ensuring investor protections.
Liquidity
Highly uneven. Large-cap stocks and Connect-eligible names tend to have deep turnover, while smaller caps stocks can be extremely thin and exhibit sharp swings when sentiment toward digital assets heats up. DATs are typically small/mid-cap; liquidity depends on sentiment and institutional participation. International and Mainland-accessible capital can create valuation upside for crypto-themed issuers, but that premium is generally more constrained than the extreme multiples sometimes seen in U.S. DAT names, where investors have historically paid very large premiums over the marked value of the underlying tokens. Arbitrage opportunities (vs. U.S. peers or ETFs) also draw global investors.
1.4.3 Japan
Japan has seen the rise of pioneers like Metaplanet and Quantum Solutions being leading DATs in the japanese market. Metaplanet is the largest Bitcoin-holding company in Japan and ranks fourth globally. It has been referred to as the “Strategy of Asia.” Quantum Solutions has also become the largest Ethereum-holding company in the Japanese market. The Japanese market is known for its prudent investment culture and strong institutional framework, which has recently attracted international investor interest. Japan’s regulatory environment, while cautious and risk-focused, provides a clear and structured framework for digital asset activities. Under the Financial Services Agency’s (FSA) supervision, companies may hold and disclose digital assets on their balance sheets provided they comply with existing accounting, disclosure, and transparency requirements.
Listing & Issuance Tools
Funding is primarily via third-party allotments or public offerings (new share issuance), under cautious processes. ATM is uncommon; convertibles require strict conditions and are typically underwritten by major securities houses. Compared with the U.S. and Hong Kong, Japanese fundraising is procedurally controlled and more negotiated. Japanese DATs often proceed gradually: first deploy own cash to buy crypto; after appreciation, conduct small placements at favorable levels to scale reserves (as Metaplanet did).
Regulatory Framework
Accounting treatment is similar to IFRS (crypto as intangible assets), making P&L measurements conservative. The FSA closely reviews crypto companies that enter crypto, requiring detailed business rationales, governance frameworks, and anti-speculation measures. Custody and security standards are stringent; assets must be with licensed custodians or protected by robust internal controls to avoid audit qualifications.
Investor Base
Dominated by domestic institutions (banks, insurers, pensions) and retail. The DAT trade has attracted investors looking to optimize capital efficiency. A major driver is tax policy: personal crypto gains can face taxes up to 55%, whereas equity capital gains are ~20%. Thus, buying Metaplanet stock can be a lower-tax proxy for Bitcoin exposure — an idiosyncratic feature of Japan.
Liquidity
Moderate overall. DAT stocks may start thin but can become active as awareness grows. There are no designated market makers; liquidity is organic. Names like Metaplanet soared during Bitcoin bull phases and later retraced — showing high correlation with BTC.
2. How DATs Finance Themselves
DAT financing tools are evolving rapidly, forming a multi-tiered, diversified toolkit. These vary by speed, cost, investor appetite, and disclosure complexity, suiting different stages and sizes of DATs.
At-the-Market Offering (ATM)
An ATM lets a listed company sell new shares directly into the market at prevailing prices in small, continuous tranches via a broker, accumulating cash over time. There’s no need to negotiate with specific investors, and the company controls execution.
ATMs don’t deliver lump-sum proceeds; capital is built gradually, depending on liquidity and sell cadence. But they avoid large one-off dilutions, fitting a steady, ongoing crypto allocation strategy.
Private Investment in Public Equity (PIPE)
A PIPE is a private placement of shares to specific institutions or investors, bypassing public offering processes to secure a large capital raise quickly.
PIPEs often come at a discount with other favorable terms to compensate for liquidity constraints. Their hallmark is speed: once terms are set, signing, funding, and issuance complete rapidly. For DATs seeking to build positions fast, PIPEs are an efficient “one-shot” solution.
Convertible Bonds (CB)
Convertibles combine debt and equity features. The issuer sells bonds with an option for investors to convert into equity at a preset price within a window. If the stock doesn’t rise, bondholders expect repayment; if it does, they convert to capture upside.
CBs are relatively fast and can raise large amounts. Coupons are usually lower because the conversion option has value. The key risk for a DAT is: if the stock underperforms, the debt must still be repaid. Weak price performance at maturity can force asset sales (e.g., selling coins) to meet obligations.
Preferred Shares (PS)
Preferred shares are hybrid securities with equity and debt characteristics. Strategy pioneered a suite of four preferred share series — STRC, STRD, STRF, and STRK — as alternative financing for its Bitcoin acquisition strategy. Functionally akin to digital credit products, they provide new capital without immediately diluting common shareholders (MSTR). Each series has distinct yields, seniority, and conversion terms.
Preferred shares are typically privately placed with specific investors, enabling fast, sizable fundraising. The cost is the dividend, but they avoid immediate common dilution. The STR series offered 5.6%–7% net annualized yields (after a 30% tax assumption). For DATs, this cost sits below common equity, above traditional debt.
Equity Line Agreement (ELA)
An ELA is a flexible “equity drawdown” arrangement: the DAT signs an agreement giving it the right (not the obligation) to sell common stock to an investor up to a specified limit and period.
Control sits with the company, which decides when and how much to sell based on share price, market conditions, and funding needs. This makes the ultimate financing amount more predictable, addressing prior uncertainty. Because the facility can be tapped as needed, the company can raise funds to buy digital assets without destabilizing the share price, and potentially narrow discounts when the stock trades below NAV.
Table: Comparison of key DAT financing tools
Source: HashKey Capital
3. How to Assess a DAT’s Investment Value
Evaluating DATs requires a framework distinct from traditional companies. Performance depends on the underlying team leadership, capital markets execution, long term value of the asset, risk management as well as other financial indicators. Below are common key metrics, their formulas, and considerations.
Leadership
Soft factors like the founding team often matter most in the DAT model. DATs rely heavily on a founder’s influence in the community and sustained financing ability. For example, Michael Saylor’s impact on both community and investors, or Tom Lee for BitMine. A highly influential leader strengthens fundraising, keeping the DAT flywheel turning. This leadership moat is hard for imitators to replicate through financial engineering or governance alone.
Management and governance capability
Success depends on management’s timing and capital‑markets execution. Companies should weigh market conditions against their own share price and financial position to choose the right instruments for ongoing operations. For instance, Strategy relied heavily on convertibles early on, shifted toward ATM in 2024, and in 2025 issued multiple series of preferred shares such as STRK, STRF, STRD, and STRC.
Ecosystem participation and long‑term value
DAT is not merely “buy and hold.” Strong models embed the company in the underlying asset’s ecosystem to create mutual reinforcement. With ETH, for example, a DAT can stake to support network security and earn yield. Over time, they may also participate in low‑risk on‑chain protocols to enhance returns, and invest in ecosystem projects, incubation, and developer communities.
Financial indicators
Alongside the qualitative factors, use quantifiable metrics to analyze a specific DAT’s status. Post‑investment, monitor these indicators to manage positions, including decisions to add or exit.
Financial Metrics
Net Asset Value (NAV)
Refers to the total market value of the company’s digital assets minus related liabilities, divided by the number of shares outstanding to get per‑share crypto asset value.
NAV Multiple (mNAV)
The ratio of share price to per‑share NAV, indicating the premium or discount versus underlying crypto value. It can also be approximated by company market cap divided by treasury asset value.
mNAV > 1 implies a premium. mNAV < 1 implies a discount. Deeper interpretation: mNAV reflects the market’s view of the company’s “future value creation” ability. Calculations can be refined using basic versus fully diluted share counts.
If mNAV > 1, the stock trades at a premium to its coin value; if mNAV < 1, it trades at a discount. At a deeper level, mNAV expresses the market’s view of the company’s future value-creation capacity. One can refine calculations using basic vs. fully diluted share counts.
Bitcoin/Base-assets per Share (BPS)
The amount of a given crypto (often BTC or ETH) held per share.
This shows capital allocation efficiency. If, after accounting for dilution, per‑share holdings still rise, existing shareholders’ exposure is “amplified” and value is being created. Strategy, for example, increased BTC per share from about 0.001 to roughly 0.045+, implying a strongly positive “Bitcoin Yield.” The opposite — frequent issuance without sufficient purchases — erodes BPS.
Bitcoin Yield
Proposed by Galaxy Digital in 2025, this measures the percentage change of BTC per share after accounting for dilution. It’s the change in BTC per share over a period divided by beginning BTC per share. For example, if BTC/share rises from 0.01 to 0.015 over a year, Bitcoin Yield = 50%. It’s akin to a fund’s return but specific to per-share digital asset accretion — a key indicator of whether the DAT flywheel is working.
Leverage
Not DAT-specific per se, but investors should track debt relative to asset value (e.g., Debt / Market value of holdings) or debt per coin (debt per BTC). Excessive leverage amplifies upside and downside and must be assessed via financial statements.
In all, DAT equities are a way to participate in crypto bull–bear cycles via a traditional equity wrapper. The allure is the dual positive impact of crypto price + premium expansion in bulls (e.g., MicroStrategy vastly outperformed Bitcoin from 2023–2025). Conversely, during bear market, the dual impact can also amplify losses (asset decline + premium flipping to discount) causing premiums to vanish and market caps shrink — prompting broader skepticism of the theme.
4. Risk Management
DAT operations span four core functions: raising capital, asset management, revenue streams, and coin/equity dual-growth mechanics. Risks arise both internally (financing structure, custody/operations, organizational design) and externally (market volatility, policy changes) due to the highly volatile underlying assets.
During capital raising, DATs commonly use equity and convertibles. Different instruments carry different risks.
Financing Structure Risks:
Equity Financing Risks
With ATMs, companies can continuously issue small amounts in the open market. Though each tranche is small, cumulative issuance expands share count, diluting existing holders and EPS. Beyond the usual effects, ATMs face three key risks:
Timing risk: Long execution windows mean persistently weak prices can force lower sale prices, raising capital costs and jeopardizing targets.
Uncertain size/pricing: ATM outcomes depend heavily on market conditions and liquidity which companies have less control hence complicating treasury planning.
Transparency concerns: Running repurchases alongside issuance demands strict compliance to avoid any appearance of market manipulation.
Debt Financing Risks
Convertibles can include put features. If the stock trades below thresholds for an extended period, investors may exercise their puts to force redemption at par value. Large-scale puts can create cash-flow stress, forcing high-cost refinancing to meet redemptions, amplifying credit risk in the event that cryptocurrencies fall in value.
Governance Risks:
During the asset management phase, companies holding significant financial assets must balance two primary objectives: custody security and enhancing investment returns. Beyond meeting the core requirement of asset security, effective allocation is essential to optimize management returns. This phase presents the following risks:
Custody & Operational Risk: Key management, hacking, and internal fraud are ever-present threats. DATs rely on third-party custodians or use multisig wallets and cold storage, yet history has seen exchange thefts and lost keys.
Allocation Risk: Moving from single asset to diversified allocations may be constrained by investor agreements and increases custody complexity and management difficulty. Having more assets also increases volatility of shares.
Business Model Risk: Pure “buy-and-hold” strategies can carry opportunity costs; value must be enhanced through staking and other designs to improve returns. For example, many U.S. Ethereum-holding companies generate income by participating in staking, forming a differentiated business model from pure BTC holders.
Liquidity Risk: Reflected in average trading volumes, bid-ask spreads, and market-making depth. In extreme market conditions, assets may be difficult to liquidate quickly, potentially triggering a liquidity crisis.
Business Risk
Running a DAT company that relies on continuous funding and value accrual to tokenholders through token purchases can bring several challenges:
Financial Sustainability: Excessive leverage and opex compress margins and long-term financial health. If company is unable to manage debt financing effectively, this could lead to valuable assets unwinding.
Asset Disposition Risk: Forced sales may occur at market lows or amid illiquidity — creating a dual impact on both shares and asset value.
External Risks
At the coin/stock dual-growth mechanism level, if the strategy is appropriate, a virtuous cycle can be formed. However, DATs also face external risks from the macroeconomic environment:
Market Risk: Black swans or negative narratives can trigger sharp drawdowns. BTC declines can often lead to magnified declines in altcoins. Asset dwindling value translates into stock price declines. If liquidity tightens and/or negative signals proliferate, investors may redeem en masse; managers then sell at low prices to meet outflows, risking a redemption–selloff–NAV drop–more redemptions spiral that can culminate in default.
Policy & Regulatory Risks:
Policy Continuity: Crypto policies often track political leadership. A shift in administration to one unaccepting of crypto could change direction and challenge existing frameworks.
Legal Characterization: Different regulatory regimes around the world regulate the listings of digital asset treasury firms differently. Some countries may oppose the trading of pure cash/liquid assets company without a viable and sustainable business model hence hindering the growth of DATs.
Jurisdictional Differences: Tax regimes and crypto acceptance vary widely, creating a complex compliance landscape.
Conclusion
This report outlined, from both operator and investor perspectives, how to build and how to invest in DATs, introduced a key metric set, and discussed related risks. The next part of this series will focus on practical FAQs frequently encountered by DATs.
