Digital Asset Treasuries (DATs) were among the most visible corporate phenomena of the last bull cycle. Built on prerequisite to hold bitcoin on the balance sheet was itself a value-creating strategy, many attracted strong market premiums simply by accumulating BTC faster than the competition.
But as valuations normalize and net asset values (NAVs) tighten, DATs are finding that passive exposure may no longer be enough.
“There’s been this collective realization as NAVs start to push,” Matt Luongo, co-founder and CEO of Bitcoin financing platform Mezo, told CoinDesk in an interview. “Most of them don’t actually have an advantage over others by buying bitcoin – you can do that yourself. Now they have to earn dividends and implement strategies that retail may not know about yet.”
Some DATs that boomed into public markets now face a different environment: one where investors increasingly expect operational results or revenue generation, not just BTC appreciation. Even the corporate bellwethers of bitcoin strategy have faced similar pressures. Across the category, the argument that simply holding bitcoin is no longer the full business model has been strengthened.
Brian Mahoney, Mezo’s co-founder, adds that DATs also face a narrative limitation. “These companies want the dividends found in ecosystems like Ethereum or Solana, but they can’t go there,” he said. “It’s a violation of the story they’ve been telling shareholders. You can’t claim to be a Bitcoin native treasury while earning your dividends from ether strike.”
A New Institutional Question: What Can Bitcoin Do?
Anchorage Digital, the federally chartered crypto bank that serves institutions from hedge funds to public companies, is seeing a shift in the kinds of questions clients are asking.
“If all you want is price exposure, there are plenty of ways to get it,” said Nathan McCauley, CEO of Anchorage Digital, in an emailed comment. “However, institutions increasingly want their bitcoin to be productive – to earn rewards, unlock liquidity or serve as collateral. They want infrastructure that lets them interact with the Bitcoin economy directly, securely and in full compliance.”
Through Anchorage’s self-managed wallet, Porto, clients lock up BTC to earn on-chain rewards or borrow against their holdings. “We enable institutions to put bitcoin to work without selling it, without moving into unregulated environments and without compromising custody,” McCauley said.
The growth of BTCFi — from about $200 million in total value locked in last October to a peak of about $9 billion in early October — reflects growing interest, but McCauley notes that it’s still “a drop in the bucket compared to the total bitcoin supply.”
Early adoption patterns
McCauley sees three categories of institutions emerging as early adopters: hedge funds and multi-strategy firms seeking directional returns; asset managers and DATs that have significant BTC reserves; and crypto-native funds that want BTCFi access without building their own infrastructure.
Across these groups, he sees consistent demands: “predictable economics, clear safety mechanics, and fully explainable risk.” The first offer via Porto – loans against BTC at a fixed rate on Mezo – fits this profile, with stakes to follow, he said.
The upcoming inflection point
The next 12-24 months could mark a meaningful acceleration in BTCFi participation if more structural pieces fall into place.
“The inflection point comes when the complexity disappears,” McCauley said. “When institutions can activate their bitcoin through familiar custody, compliance and settlement workflows instead of building parallel systems.”
He identifies three drivers for the scale: regulatory clarity, custodial integration and risk frameworks that map institutional thinking. “When these pieces align,” he said, “you can easily see tens of billions of institutional BTC shift from passive holding to productive deployment.”
Luongo believes this shift is already happening behind closed doors. Conversations with CEOs in the space, he said, reflect a sense of urgency driven not by price but by competitive pressure. “Big banks we thought would move slowly are coming in six to 18 months,” he said. “Behind the scenes, the deals happen quickly.”
Mahoney points to fintech convergence as another accelerator: traditional finance front-ends are being plugged into tokenized rails where users interact with crypto without realizing it.
A new partnership between Anchorage Digital and Mezo offers institutions a way into BTCFi. Through Porto, institutions can now borrow against their BTC using Mezo’s MUSD stablecoin at fixed interest rates starting at 1%.
Loans via MUSD are live today, while veBTC rewards will soon roll out across Porto and Anchorage’s wider platform.
