DAT mode is undergoing a major market test

Author: Yue Xiaoyu; Source: X, @yuexiaoyu111

The DAT model is undergoing a significant market test!

1️⃣ What is the biggest fear in the market right now?

It’s DAT (Digital Asset Vault) companies selling coins.

Previously, listed companies borrowed money to buy coins, and the market was very optimistic, with prices spiraling upward;

Now, as the market deteriorates, once these companies start selling coins, confidence will collapse, leading to a market stampede.

2️⃣ How exactly can we assess the current operational status of DAT companies?

Currently, the main metric used in the market is: mNAV (Market Net Asset Value Multiple)

In other words, how many coins a company has accumulated; these are its assets, mainly looking at the ratio of the company’s market value to its digital asset holdings.

If the ratio is greater than 1, this indicates a market premium, showing investor recognition of the company’s value and future growth potential;

If the ratio is less than 1, it means assets exceed market value, and the assets cannot support the market value, which will trigger a reassessment of the DAT model.

Currently, the leading DAT Strategy’s mNAV is 1.03, approaching negative premium territory.

At this point, a death spiral is very likely to occur: asset depreciation → further decline in stock price → financing difficulties.

It can be said that the current market condition is a huge test for the DAT model.

3️⃣ The DAT model is not just about traditional companies borrowing money to buy coins; more importantly, the interests of these traditional companies are now tied to the ecosystem of this token.

For example, a company using Ethereum DAT needs to find ways to boost the token price to increase its stock value, naturally providing strong incentives to participate in the token’s ecosystem.

This could include staking on PoS chains to improve network security, lending tokens to DeFi protocols to provide liquidity, or investing in startup projects within the ecosystem to support practical applications.

Only when the ecosystem prospers can Ethereum’s token price be sustained, and companies’ stock narratives be built.

Therefore, listed companies will become the biggest promoters of the token ecosystem.

Even if recently Ethereum founder Vitalik came out to say that centralized companies pose a threat to decentralized Ethereum.

But on the flip side, this also acts as a huge driving force for Ethereum’s ecosystem development.

4️⃣ Returning to BTC, Bitcoin vault companies will also promote the development of the Bitcoin ecosystem.

So, how exactly will they do that?

First, it still depends on making Bitcoin more liquid.

Currently, after traditional institutions buy coins, they still store them in cold wallets or centralized custody platforms, generating no additional income.

Therefore, DAT companies seeking to increase their premiums cannot simply hoard coins; they must use digital assets to generate yields, which creates a narrative space.

This is the intrinsic driving force behind the renaissance of the Bitcoin ecosystem.

Recently, I also saw a research report released by the Bitcoin Layer 2 network GOAT Network, which emphasizes this point and envisions becoming Bitcoin’s yield layer.

Thus, the market test faced by the DAT model is not only about the death spiral caused by falling prices but also more importantly, about answering a fundamental question: how to create $2 worth of value from $1 worth of BTC?

Hoarding $1 worth of Bitcoin can only support a $1 company market value, but efforts are needed to generate more premium.

Helping digital assets build ecosystems is one of the ways to break through.