The premium on Digital Asset Treasuries (DATs) has disappeared because the market has realized that the "fund-raising, buying coins, market cap growth" flywheel can no longer turn, while companies' cash flow gaps are growing larger. The so-called "digital asset treasury premium" is essentially the extra price the market was willing to pay for "leveraged Bitcoin exposure," and that price is now heading to zero.
The Flywheel Stops: The Math Behind the Disappearing Premium
The DAT model pioneered by Strategy relies on a positive feedback loop: investors are willing to buy the stock at a price higher than the value of its Bitcoin holdings (i.e., mNAV > 1). The company uses this premium to issue new shares, raises money, and buys more Bitcoin, further boosting the value of its holdings.
Now this cycle is running in reverse. Strategy's mNAV has fallen below 1x, meaning the market values the company below the book value of its Bitcoin holdings. The reason is that with the emergence of Bitcoin spot ETFs, investors can now directly allocate to Bitcoin at a lower cost, and no longer need to pay a high premium for proxy stocks like Strategy.
Risk warning: The mNAV calculation itself contains flaws. When calculating enterprise value, Strategy uses the face value of debt and preferred shares, not their declining market value. As of June 26, the officially reported mNAV was 0.99, but if calculated using market prices, the real mNAV was only about 0.89. This means the actual discount is worse than it appears, and the signal that mNAV has fallen below 1 is based on an inflated valuation benchmark.
Cash Black Hole: The Logic of Forced Selling
After the premium disappears, the financing window narrows, but the company's cash outflow pressure does not ease. Strategy's annual preferred stock dividends alone amount to about $1.5 billion, while its software business generates quarterly revenue of only about $122 million. The cash flow from its main business is nowhere near enough to cover these obligations.
As a result, the original "never sell Bitcoin" promise is being forced to loosen. From late June to early July 2026, Strategy sold 3,588 Bitcoins at once, raising about $216 million specifically to pay preferred stock dividends and repurchase preferred shares. Compared to the symbolic sale of 32 Bitcoins in May, this marks a shift from a one-time operation to a routine financing tool. By early August, the total Bitcoins sold in 2026 had reached approximately 5,208.
What the Market Is Worried About
The market is not worried that the company "sold coins," but that this model is entering a potential death spiral:
Situation A: Forced Selling Risk: The company holds about 842,000 Bitcoins, roughly 4% of the global total, with an average cost of about $75,400. The current Bitcoin price has been hovering around $60,000-$64,000 for a long time, resulting in an unrealized loss of over $10 billion. Any large-scale selling could significantly impact the price.
Situation B: Drying Up of Financing Ability: With mNAV approaching or falling below 1x, the cost-effectiveness of issuing new shares for funding sharply declines. If the company wants to continue raising funds, it will either have to accept heavy equity dilution or bear high debt costs.
Situation C: Collective Pressure on Peer Companies: Strategy's predicament is not unique. The Digital Asset Treasury craze is cooling down overall. Many imitators' stock prices have fallen 80%-90%, and some companies' market caps are even lower than the value of their token holdings. The SEC and Finra have launched investigations into unusual stock price movements at DAT firms.
Practical Reference
Verification Method: Look at DAT companies' financial reports, focusing on two numbers: mNAV (if below 1, the financing premium has disappeared) and core business cash flow vs dividend/interest expenses (if the latter far exceeds the former, selling coins will become the norm).
Next Steps: If you hold or are considering these types of assets, you need to clearly understand that they are essentially leveraged Bitcoin ETFs, and the leverage is now pushing in the opposite direction. Standard Chartered has warned that a major industry shake-up is brewing, and large companies may start an acquisition spree, targeting discounted peers hit by the market crash.
