Authors: Cosmo Jiang, General Partner at Pantera Capital, Erik Lowe, Head of Content at Pantera Capital; Compiled by: Golden Finance
Our investment theme in Digital Asset Treasuries (DAT) is based on a simple premise:
DAT can generate income to increase per-share net asset value, thereby generating more ownership of underlying tokens over time rather than just holding spot.
Therefore, owning DAT can provide higher return potential compared to directly holding tokens or holding through ETFs.
Pantera has deployed over $300 million in various tokens and regions of DAT. These DATs are leveraging their unique advantages, adopting strategies to increase their digital assets on a per-share basis. Below is an overview of our DAT portfolio.
BitMine Immersion (BMNR) is the first investment of the Pantera DAT Fund, embodying a company with a clear strategic roadmap and effective leadership. Fundstrat Chairman Tom Lee articulated BitMine's long-term vision of acquiring 5% of the total ETH supply—which they refer to as "5% Alchemy." We believe that exploring the value creation of a highly effective DAT like BMNR will be very beneficial.
BitMine Case Study
Since BitMine launched its treasury strategy, they have become the world's largest ETH treasury and the third largest DAT (after Strategy and XXI), holding a total of 1.15 million ETH, valued at $4.9 billion (as of August 10, 2025). BMNR is also ranked 25th in U.S. liquidity stocks, with a daily trading volume of $2.2 billion (as of the five-day moving average benchmark on August 8, 2025).
Bullish on Ethereum
The most important factor for the success of DATs is the long-term investment value of the underlying tokens. BitMine's DAT is based on the view that as Wall Street moves on-chain, Ethereum will become one of the largest macro trends in the next decade. As stated in last month's blockchain investor letter, the on-chain migration is underway as the importance of tokenization innovation and stablecoins continues to grow (see previous article by Golden Finance: The On-Chain Great Migration). Currently, there are $25 billion of real-world assets on public chains—along with $260 billion in stablecoins, which are currently the 17th largest holder of U.S. Treasury bonds.
"Stablecoins have become the ChatGPT story of the cryptocurrency space." – Tom Lee, Chairman of BitMine, Pantera DAT Call, July 2, 2025
Most of this activity occurs on Ethereum, which benefits ETH from the growing demand for block space. As financial institutions increasingly rely on Ethereum's security to support their operations, they will be incentivized to participate in its POS network, further driving the demand for ETH accumulation.
Growth in per-share ETH
Once the investment value of the underlying tokens is determined, the business model of DAT is to maximize its per-share token holdings. The main methods to increase per-share token holdings include the following:
1. Issue shares at a price higher than the per-share token net asset value ("NAV").
2. Issue convertible bonds and other equity-linked securities to monetize the volatility in stocks and underlying tokens.
3. Generate staking rewards, DeFi yields, and other operational income to acquire more tokens. It is important to note that this is an additional leverage that ETH and other smart contract tokens DAT possess, while the original Bitcoin DAT, including Strategy, does not.
4. Acquire another DAT with a trading price close to or below NAV.
From this perspective, since launching the ETH treasury strategy, BitMine's per-share ETH value (also known as "earnings per share") has grown at an astonishing rate in the first month, far exceeding the growth rate of other DATs. The value of ETH accumulated by BitMine in the first month even surpassed the value accumulated by Strategy (formerly Microstrategy) in the first six months of executing that strategy.
BitMine primarily increases earnings per share by issuing shares and generating staking rewards, and we believe BitMine may soon expand its issuance of convertible bonds and other tools.
Source: BitMine Company, July 27, 2025
Value Creation Action
The price of DAT can be broken down into three components: (a) per-share token, (b) underlying token price, and (c) net asset value multiple ("mNAV").
At the end of June, the trading price of BMNR was $4.27 per share, approximately 1.1 times its net asset value of $4 per share at the time of its initial DAT financing. Just over a month later, the stock closed at $51, roughly 1.7 times its estimated net asset value of $30 per share. This means the stock price increased by 1100% in just over a month, of which: (a) earnings per share grew by about 330%, contributing about 60% of the increase; (b) the price of ETH rose from $2500 to $4300, contributing about 20% of the increase; (c) net asset value expanded to 1.7 times, contributing about 20% of the increase.
This means that the vast majority of the increase in BMNR's stock price is driven by the growth in per-share ETH, which is the core engine controlled by management that distinguishes DAT from merely holding spot ETH.
The third factor we have yet to explore is mNAV. Naturally, one might ask: why would someone buy DAT at a price higher than the net asset value? I find it helpful to draw an analogy here with balance sheet-based financial businesses (including banks). Banks seek returns on assets, and investors may give valuation premiums to those banks they believe can sustain returns above their cost of capital. The best banks trade at prices above their net asset value (or book value), for example, JPMorgan's valuation is twice its net asset value. Similarly, if investors believe that DAT can continuously achieve growth in per-share net asset value, they may also choose to value it at a price above net asset value. We believe that BMNR's NAV has grown by approximately 640%, which justifies the mNAV premium.
BitMine's ability to execute its strategy will manifest over time, and it will inevitably face challenges in the process. BitMine's management team and its track record to date have attracted support from traditional financial giants including Stan Druckenmiller, Bill Miller, and ARK Invest. We expect that BitMine, as a premier DAT, will capture the growth story similar to Strategy, attracting more institutional investors.
