Good afternoon, everyone, and welcome to our first of three crypto-focused events at this year's conference. I'm Michael Inez, Managing Director and Crypto Analyst here at H.C. Wainwright, and I am very pleased to be joined by a great group of panelists to discuss one of the biggest trends in crypto today: digital asset treasury strategies. As many of you are aware, we have seen a proliferation of digital asset treasury company launches this year alone, alongside an improved regulatory environment for crypto in the U.S. These DATCOs, if you will, have had a lot of success in attracting investors and raising capital to fund their crypto purchases, demonstrating what we believe to be strong investor appetite for leveraged Bitcoin and ETH exposure through traditional equity wrapper. Just to give you some numbers as to how involved corporations are in crypto in 2025, public companies now collectively own about 1 million Bitcoin on their balance sheets, worth over $110 billion at today's price, and about 3.5 million Ethereum, worth over $15 billion. Some of the largest ETH treasury companies are on the panel with us today. With all that said, we have a fantastic discussion set for you with some of the most interesting digital asset treasury companies in the space. Now, I'd like to introduce you to our moderator for today's panel, Frank Chaparro, Head of Content at GSR Markets. Frank, over to you. Thank you. Appreciate it. I like the promotion too. Head of Capital Markets sounds like a great title. I give you the promotion. Ladies and gentlemen, very much appreciate you guys taking the time. I hope lunch was good and you're ready to be introduced to the sale of groupies, as I've been calling them. Digital Asset Treasury Companies have been taking off, I think, over the last, let's call it four months, since the spring. They've really become the zeitgeist of the crypto market. I guess we'll go into the why, the why now, the how, how these things work and function, because they're not all the same, and the when. When will the music stop? Because it has to stop eventually, right? Or maybe not. We'll get into it. Let's do a round of introductions. We'll start with Charles. Thank you. I'm Charles Allen, the CEO of BTCS. We're the oldest public company in the world. We've been around since 2014. We've been focused on acquiring ETH since 2021. We run validator nodes, have block building operations, and really our treasury is a byproduct of our operations. I think we're probably one of the most innovative ETH treasury companies running the DeFi TradFi flywheel. All right. Sebastian Bea, I'm the President and CIO of Reserve One. We are what, in terms of EV, our first large diversified digital asset treasury expected to list on NASDAQ in Q4 with about $1 billion. My history is Coinbase and BlackRock. I'm excited to be part of this great group. Thanks. I'm Roger Hamilton. I'm the CEO and Founder of Genius Group, GNS. We're a Singapore-based education company. We have now set a target of 10,000 Bitcoin. We became a Bitcoin Treasury Company in November last year. There are a number of models out in Asia, like the Metaplanet model, that we've been following carefully as we've been growing. We are also teaching in our education the ABCs of the future: AI for future workforce, Bitcoin for future economy, and C as in community, which is what us humans do when those things both get up to scale. This morning, we just announced a new board advisor. If you've ever read the Bitcoin Standard, Saifedean Ammous just joined us. We're going to continue to bring some really great names on to support our journey. Josh Riezman, Chief Strategy Officer and Head of US Legal for GSR. We're one of the largest and oldest digital asset market makers and trading firms in the space. We've been very active in the digital asset trading, digital asset treasury space. We've helped to sponsor a couple of vehicles, both UPXI and MEIP. This is both in Solana and Litecoin. We've invested in about a dozen of these vehicles and decided to be here to speak with everyone today. Hi, my name is Sam Tabar. I'm CEO of Bit Digital and White Fiber. White Fiber is a company that just IPO'd last month. Bit Digital Inc. has about 120,000 ETH on its balance sheet. Bit Digital also owns just over 71% of White Fiber. White Fiber is an AI company, and Bit Digital is an ETH treasury company. Perfect. We've got 42 minutes, so let's dive straight into it. MicroStrategy's ascent really began over a year ago, February, let's say 2024. This DAT movement, if you will, didn't really kick off until the spring of this year. What was the major catalyst? Why now? What was behind the Cambrian explosion? Was it simply unbridled investor appetite in crypto equities? We'll start maybe with Sam over at the end. I want to share with you a private conversation I had with Michael Saylor. You probably won't appreciate it. He's not here. Another 40 minutes. H.C. Wainwright, where he had me in a boardroom, and I was a Bitcoin miner at the time. Bit Digital was originally a Bitcoin miner. He said to me, you know, Bitcoin mining is actually a pretty shitty business. You should be a mini MSTR. You should be a treasury company buying Bitcoin. I said to him, you're right. We agree with you. Bitcoin mining is not a good business. Being a treasury company is actually a great idea, but we'll be doing it in Ethereum. The vibe died in the room. He looked at me. He said, Ethereum is going to go to zero. I said, that's your opinion. Obviously, he was wrong. The reason why Ethereum has been unleashed in terms of valuation, why there's been a lot of positive price action in Ethereum, was because there was a point where Gary Gensler was the Chair of the SEC, and he had a bee in his bonnet about Ethereum. He couldn't even classify Ethereum as a commodity, like Bitcoin. Bitcoin is a commodity. If you talk about commodities, that's fine. There are different rules and regulations. When you're talking about a commodity, there's a very different set of laws when you're talking about a security. Nobody really knew how to talk about Ethereum. Gary Gensler was, he resigned, semi-fired. Now we have a very different era and where we have a very friendly regulatory regime towards Ethereum. We have Congress passing the Clarity Act and the Genius Act that's very friendly towards Ethereum. We have a political administration that's very friendly towards Ethereum. That's why you're seeing a lot of price action that's very positive about Ethereum. In fact, I would venture to say that if Ethereum and Bitcoin were invented on the same day, you would never have heard of Bitcoin because Ethereum is a far superior technology. You have smart contracts. You have the ability to get rid of the middleman. There's none of that technology in Bitcoin. Bitcoin is basically a store of value. Bitcoin competes with the gold markets, whereas Ethereum can basically rewrite the entire financial system. Now you're seeing this great unleashing of Ethereum. You're seeing a lot of treasury companies, like some people here on the panel today, who are focused on Ethereum and realizing that it's not just a great store of value, but it's a great technology as well. I'm big on Ethereum as well, but I do want to just get to the point of specifically the DAT Cambrian Explosion. What factors? You did hint and sort of unpack the regulatory tailwind, but Charles, do you think there's any other catalyst that really made this DAT moment in time where we've had hundreds raised? It's definitely the regulatory environment. Just to put this in perspective, as the oldest public crypto company, we probably filed more registration statements with the U.S. SEC and answered more questions than probably everyone on this panel. I'm so sorry for you. No, it's awful. I think the last registration statement took a year, and we were six months on seven immaterial questions that should have been done in a day. They just refused to do their job, which was the formation of capital and the protection of investors. By doing that, they basically stopped anyone that would think to go public in this market from doing it. We've been public since 2014, so we just relentlessly would fight the SEC on everything. Their goal was to put us out of business. It was very clear. Once the administration changed, it allowed for new entrants. It reminds me of that conversation with Joe Lubin recently. He said, you know, I commend you for being public this long and staying in business and not going out of business. We wouldn't even think about doing this because they had their own battle. They were trying to pin Ethereum being a security on ConsenSys. They wouldn't even think about going public. The second the administration changed, everything's changed. I think that's a huge point. It's a huge point. It's the same story when we think about why Galaxy couldn't upgrade to the NASDAQ, why no company since Coinbase could go public under the Gary Gensler regime, we'll call it, is part of why DATs now are having their moment. Sebastian, maybe explain the perspective of the investor. Why are so many interested on the investor side in allocating to digital asset treasury companies? Sure. I think one of the key things that has changed, and I know this is going to be a little controversial, but the level of trust that investors now have in the industry and the underlying vendors that service the industry to deliver the assets has changed dramatically. We used to be, and still many are, in the not your keys, not your crypto. Totally get it. A very large percentage of investors are now saying, I know what Coinbase is. I know actually what Anchorage is. I know what Kraken is. I've heard of all of these companies, and I actually have a level of trust with this ecosystem that I didn't have before. I think that what we have seen more broadly is now that people trust, not everybody, but a large percentage of investors now trust the ecosystem far more than they had before. Now they want to do something with their assets. Many of the, one of the value adds of DATs is that they can, with better liquidity terms than an ETF, deploy their assets to seek yield on behalf of investors. The implicit assumption there is that these DATs, whomever you may be trusting, are entities that you trust, and you trust their underlying infrastructure. I think two years ago, the answer was no way, no how. Right? I think all of us probably recall where we were when FTX went under. It was not a great day, and it was really not a good two years. The industry has obviously self-corrected in many different ways. Now everyone knows what QC is, et cetera. We're at a point now where investors are saying, not only do I want Ethereum, do I want Solana, do I want Bitcoin, but I also want some help to use those assets to maybe generate some return. I think that's why DATs, in general, are probably seeing a bit more adoption now. Interesting. More regulatory clarity, or that regulatory tailwind, and more trust in crypto's capital markets. Raise your hand if you trust crypto's capital markets. Raise your hand. Don't look at anybody else. This guy's looking at people. Don't look at anybody. All right. I bet there'd probably be a lot fewer hands two years ago in the wake of FTX, but we've got some convincing to do, gentlemen. Clearly, in this room, we have some convincing to do. Trust and regulatory clarity, both tailwinds. Question for you, Josh. We've invested in about, I think, 12 of these things. To what extent is this a short-term or a long-term play for investors? When does the music stop? I think what we've seen, kind of going back briefly on what you were saying before, is like in a lot of markets, a dislocation between supply and demand. There's been a supply of digital assets in the digital asset ecosystem, obviously, but not in the securities wrappers. There's a tremendous demand ongoing for exposure to crypto in securities wrappers. That's what we've seen behind the, let's call it, really aggressive demand for these various digital asset treasuries. In the near term, it's supply that kills booms. There will be an oversupply. Our expectation is at some point, the market will become fatigued. You see it in the trading, differentiation between different vehicles now. There's no doubt that good projects will seek public vehicles in the securities markets. We expect that to continue. You're going to see a differentiation between projects. We hear the case for Ethereum. There's the case for Bitcoin, which we'll hear again from Saylor. GSR works with about 150 different crypto projects who are all angling at some level to have their day in the sun and gain exposure to securities investors. Everyone's going to try. It's going to come down to execution amongst the different vehicles. When I think about a lot of the decks that I've seen of these digital asset treasury companies, the story or the narrative is an institutional gateway to the specific coin, right? Because they may not have that wrapper in an ETF or an ETP. Once we see the SEC maybe approve the long tail of cryptocurrency ETFs, a question is then raised that what is the value then of these DATs if they are just a securities wrapper for these assets? What then is the value once a Solana ETF comes to market, for instance? It's a fair question. What is the distinction? If you just look at them basically, you have a Bitcoin ETF and a digital asset treasury based on Bitcoin. One is a simple exposure to the asset, and one is a present value of their future capital markets activity, which you would not have in an ETF. Generally, our view for digital asset treasuries is a fundamentally difficult vehicle that's able to tap through smart and intelligent capital markets activity, lower cost of capital, and you'd be able to get elsewhere to deliver to investors to increase their, let's call it, crypto per share. That's the idea, the yield increases based on their ability to present value that low cost of capital. It's a fundamentally different vehicle. It comes with other risks from mismanagement and potential debt levels, which don't exist in the ETF wrapper. It comes with potential for both growth in principal and also in yield versus the underlying. There are different levers with which we can play to sort of add to that sort of premium to nab that these vehicles trade at. Maybe, Charles, you can walk us through as an operator what those different levers are. I think there's a couple of ways to think about a DAT. For example, for BTCS, it's really a byproduct of our operations. We've been running validator nodes for five years. We're a block builder. What I've heard from a lot of investors is these things may trade near NAV or slightly above. Our goal is to drive scalable revenue growth through an operating business. I think that's really unique to Ethereum and some other blockchains you can build on. With Bitcoin, you can't really do much. You can just have elaborate capital markets transactions to provide different angles of leverage. On Ethereum, it's a whole digital economy that's powering the tokenization of real-world assets on a global scale, which is the same as what the internet did with information. When I look at Ethereum, I see our company, we see so many opportunities in which we can drive scalable revenue growth that utilizes our operations that grow our balance sheet in ETH. I think that's probably what separates us or makes us unique. There's also strategies beyond in DeFi, just tapping convertible notes and ATMs and preferred. There's a whole host of things you can do in the DeFi ecosystem. I think playing on those levers should theoretically yield a higher price to book, maybe even trade on other metrics like a price to revenue or an EBITDA multiple, at least in the long run. are different ways in which you can go to market with a DAT, whether it's a pipe or a stack. Obviously, there's another consideration in the company that will sort of put the crypto on its balance sheet, the legacy brand, if you will. Sebastian, maybe walk us through some of those different elements of the DAT. You have a lot of random NASDAQ-listed companies that only run a ceiling fans business or something ridiculous that are going out and saying, we're going to buy Dogecoin vis-a-vis a pipe. What's the sort of standard and what do you think are the best practices? It's hard to say. I think we should also recognize there was an article that came out last week, I think from The Information, that they had a story specifically that NASDAQ was looking into potentially constraining companies with respect to this element. I think we need to watch for that. It was a bad hair day for many of the DATs. I think it was misinterpreted for existing companies that are in the space. The way the article was written, it suggested perhaps that existing DATs that are operating, like some of the folks that are on this table, DATs rather, would be unable to issue. I think that what NASDAQ is talking about potentially is potentially constraining, as you say, a plumber company going and deciding they want to be a DAT for Dogecoin. Look, I think just like any other business, you should have some sort of rationale that you strongly believe that you can add value for your underlying investors. If it is a cash grab, if it is an opportunistic trade, that's where you should stop, right? Because then you have no skill in that element, and you're going to have hedge funds all over you shorting your stock and then daring you to buy back your token at a discount to nab it. I think it was said earlier that essentially every bull market is killed by a banker somewhere because the paper comes out when prices are too high. We have seen a lot of companies come to market relatively quickly. It does seem like it is slowing down. I think that's a really positive sign. Roger, what do you think is behind the slowdown that we're seeing? I think one of the big questions everyone's got at the moment is, is this a bubble, and what happens with a slowdown? Are things going to speed up? I think the easiest way to understand this, and I totally agree earlier we were talking about the trigger of a change in regulations, a change in administration. A lot of the DATs that we're seeing in Asia have had no change in regulation. They're not subject to the SEC, but there's still this massive explosion of them happening. Why is that? I would say a huge amount of this and the institutional wave is taking place because we have hit this 5% adoption mark. In any exponential curve, you're going to get to 5%. The first 100 million wallets has now been reached. This happened with emails in 1999. When that happened, institutional interests showed up with dot-com companies. It didn't mean that two years later there wasn't a massive bust, because there was. At the same time, it went from 5% up to 10x that with emails to a billion within five, six years. If you believe that now that we've got the Genius Act and everyone can have a wallet that can actually now transact digitally, what are the chances in the next five years we're going to go from $100 million-$1 billion? If you think that is going to be the case, then it's going to be much more a matter of what are the strategies of the companies that now move into this space. Genius, for example, when we had our IPO three years ago, we already had a credit system which was based on Bitcoin. We had to get rid of it in order to IPO because the SEC wouldn't allow us to have something blockchain-based on our books at that time. We can now go back and revisit that right now. That enables all our students to have student credits. Also, we're building out campuses which are tokenized. The amount of interest in Asia on real-world assets, which are backed by Bitcoin, is huge at the moment. Being able to do that as a public company means that we have a very, very clear tie-in, which means we can be giving people a 10% yield on Bitcoin by basically backing tokenized real estate off the back of it as well. These, I think, are the kind of integrations that if you have DATs that have a very, very clear case where their operational business is in some way linked with their treasury, I think those are the companies that are going to succeed in the future. I think there's going to be others that aren't just going to slow down, but actually implode if they don't have a really concise strategy that investors can understand. That makes sense. Sam, you sort of outlined the sort of bull case or thesis for Ethereum and really outlined the narrative there. I think narratives are so important for a lot of these digital asset treasury companies because it's important to speak to not just institutional investors, but also the retail market as well. What do you think, where do you think sort of the threshold is for coins on the long tail to be big enough, have enough momentum, have a big enough community to warrant a DAT? I mean, when you say coins on the long tail, you mean like Bitcoin, things like that? Outside of the top five majors. Right. I don't think there's much of a future for them. I've been on 100 panels since 2017. I co-founded an Ethereum company back in 2017 that I sold to Joe Lubin in 2020. I've been asked about this question about, like, is there a bubble in Ethereum? I remember that question being asked when it was $300. I kept saying the same thing. There's no bubble in Ethereum. Just to be very clear with everybody, there are two huge story arcs in our time. There's AI, which is a huge story arc that's going to transform society, and there's smart contracts, which is going to transform capital markets. There are many expressions of smart contracts. Bitcoin is not one of them. There's Ethereum, and there's Solana, and a few others that have smart contract technology. Why is that exciting? It disintermediates the middleman. What does the financial industry do? It creates friction. It imposes itself as a middleman to create some friction so that when value is going from point A to point B, the bank takes a little bit off. That's how they make money. That's how the financial industry makes money. Initially, the financial industry was very resistant to blockchain technology because it's a threat to the business model. Now it's embracing it. It's going to replace a lot of back office and middle office functions. There are people who are championing Ethereum. Some people are championing Solana. The reason why I championed Ethereum, and most of Wall Street champions Ethereum, is because there's no downtime. It's not as fast as Solana, but Wall Street has decided that zero downtime is more important than speed. That's why you're seeing Ethereum as the darling right now of Wall Street. I don't think there's any bubble with Ethereum. It's the same answer I give to the same question since 2017, when it was $300. It's going to continue. It's going to continue quite a lot. I would encourage everybody here to buy Ethereum. There's going to be cyclical gyrations. There will be. It will go down. It will go up. There's structural upside. As I mentioned earlier, Ethereum is now unleashed from the folks of Gary Gensler and so on, and there's regulatory clarity, particularly about stable coins. Remember, more than half of stable coins are built on Ethereum. You're going to see Ethereum have its day. That's why you're seeing a lot of these DATs doing very well. Now, there are two reasons why DATs exist. A lot of hedge funds really can't justify to their investors that they'll buy an ETF. Why would they charge 2 and 20 if the hedge fund manager is buying an ETF? If they're buying a DAT, that seems a little bit smarter. Why are DATs even a thing? It's because the capital markets are, I think you mentioned it much more eloquently, but I'll just dumb it down if that's OK. The capital markets are basically front-running what they think the ETH DAT will do. A lot of DATs right now are basically, let's look at Michael Saylor. He's at $1.5 billion right now at NAVs. They're basically imputing that Michael Saylor is going to keep buying Bitcoin, and that's why he's trading at a premium. He's going to continue to aggressively buy Bitcoin in the future. There's no other reason why there's a premium to NAV unless Michael Saylor continues to buy and uses the capital markets to buy a lot of, sorry, not Ethereum, but Bitcoin. I can speak for ourselves, we are all plagiarizing. I'm plagiarizing Michael Saylor's playbook. We're doing the same thing. Capital markets, financial engineering, buying a lot of ETH because the capital markets are making a bet that I'm going to continue buying more and more ETH, and that's why they are buying the stock. It's not illegal. They're just thinking that, he said it much more eloquently, that I will be buying more ETH, putting it on the balance sheet. The one thing that's very different with Bit Digital is that we own 71% of a security called White Fiber. White Fiber is a company that I IPO'd last month, and that is an AI company. For us, it was extremely important. It's a bit self-promotional, but it's extremely important. As I mentioned, the two biggest story arcs of our time are smart contracts, in other words, Ethereum, and AI. We wanted to position ourselves to have exposure to both of those story arcs. We have Ethereum on our balance sheet that we stake, and we have AI. We own 71% of White Fiber, which is just doing data centers and cloud, purely AI. Those are the two largest story arcs of our time. The one huge difference is that in six months from now, the lockup of White Fiber will expire. We have a huge capital lever that no one else has, where we could actually sell down that position, should we wish, without diluting investors, so we could buy a bunch more Ethereum. That's the unique position that Bit Digital is in. We have exposure to two larger story arcs of our time, which is smart contracts. You could choose whether you want Solana as your smart contract proxy or Ethereum. I choose Ethereum for the reasons I mentioned and artificial intelligence. Sebastian, do you agree with Sam that the only reason why these DATs trade above NAV is the expectation among the investor base that the DAT will go out to market and buy more of the underlying asset? I think that the investor base itself is changing. It's going to change a lot over the next two to three years. It has definitely been the case that some investors have wanted to buy a Bitcoin DAT or an Ethereum DAT or Solana DAT because they want to see their assets grow. Right? If you buy IBIT from iShares, where I did some time, it wasn't a prison service, but you know, if you buy your ETF, that's the most Bitcoin you're ever going to have. Right? There is definitely this thesis that DATs can grow your Bitcoin per share, your Ethereum per share over time. I think it's not so much front-running. What the investors are going to continually ask, I think in the future, is that we add value. Right? We have these really important and powerful assets. Right? Whether it's Bitcoin, Ethereum, Solana, or in our case, because we have all of those, investors are going to ask, OK, you have my Bitcoin. What are you doing with it to maybe generate some incremental yield? I think investors are going to say that, and that will be the source of potential investor demand in the future, that we will be scaled investors in the ecosystem that these investors can potentially trust on their behalf to own and deploy those assets. That will be another source of demand, I think, for the assets. It will be a way we can add value. Some of these DATs look a little bit different than others. Some of them can do venture capital in the space. Some can't. Some people have operating businesses that actually demand the use of their balance sheets, so maybe they can actually use their crypto in-house. I think that today, there's a lot of clarity as to what a DAT is. I think in two years, DATs are going to start to look a little bit different. The capital markets environment itself is still just opening up. We have companies going public even this week that are potentially transformational. A lot of investors are going to want to see that in the DATs themselves. I think that could be another lever. Sorry, but what value are we adding exactly as a DAT towards the Ethereum ecosystem or whatever? Sorry, say again? You said that we're a value add. What value are we adding? I'm actually talking about investment return. In the case of, let's, we were talking earlier about Bitcoin not having a lot of value, right? Because you can't stake it, right? It's just there. You just poke it. It doesn't do anything, right? I think that's not totally true in the case of Bitcoin because it is viewed as the most pristine collateral in the digital ecosystem. That collateral can have value if you want to put that collateral at risk, right? What I mean by that, to be totally specific, is if we have our Bitcoin and we can deploy it so we can earn Bitcoin plus some net return in Bitcoin terms, right? We're not a Bitcoin-only DAT, but imagine if we were, you could say, Bitcoin, IBIT's going to do beta minus 20 bps. A Bitcoin DAT could say, I could do beta plus two net or three net or four net. That would give a rationale as to why an investor would prefer a DAT over an ETF. Because it has yield. Because it has, yeah, it's compounding in crypto. I mean, that's stealing a phrase from someone else in the industry, but I think that that's what investors are going to ask for. If you look at just the institutional equity space, you can go to BlackRock and go get your ETF, or you can go direct to the index, the index team, and you can pay literally less than one basis point for the S&P 500. They will then go and lend the underlying shares, so you actually get paid to be long of the S&P 500 because they're doing SEC lending. That whole world is, I think the DATs are the group that can bring that sort of asset deployment to bear. I think that's part of why there is some potential interest in the space. Plus also the returns that come when we already go to the second phase, like what happened today with Tomlene and Bit Digital Inc. and Worldcoin is exactly that. It's not just investing in crypto. It's actually investing in the ecosystem. It's actually getting returns because there's value being developed in the ecosystem as well. This is no different from 200 years ago here in Manhattan when most of Manhattan was green. You could say, if you want to buy some of Manhattan because it's going to be valuable, is it better to buy the land, or is it better to buy a developer who knows how to take the land and build a four-story, 40-story, 100-story building on top of that land? I think we're going to see more and more that that's the ones that are like the developers that are actually investing in the companies adding value within the ecosystems of the new digital economy. Josh, it's an interesting question that Sam raised, which is how are DATs adding value? I'm sure it's something that we grapple with with a lot of the sponsors with which we're working. How are they answering that question? It's the same thing. It's being very smart on the capital issuance side, learning how to deploy and generate yield. What do you mean by the first part? Being smart on the capital issuance side. Where can you attract the lowest cost of capital? That may be right now, investors are offering you $2 or $1 crypto if you're trading at a premium. You're going to take that all day. I think to the extent that continues, we should all quit our jobs and go sell that crypto. That's our internal viewpoint. As that decreases, you have other options that these companies are pursuing. One is obviously convertible debt. There is a tremendous demand on the convertible side for high volatility type products. You can generally, not always, and depending on the company, attract very preferential rates, so low cost of capital to deploy to be accretive to your shareholders. Increasingly, what I think the panelists have been talking about is how can I integrate into my ecosystem to generate a yield? That yield also then can be passed back to investors. There is a natural staking yield in some products like Ethereum and Solana that we have DATs already that are generating tens of millions of dollars just by staking their assets and providing security for their native blockchain. Increasingly, we're saying, OK, how can we even surpass that native staking yield for the various assets? You see things like engaging in borrow/lend activity, potentially DeFi activities, so decentralized finance generating yield by all sorts of lending activities. Increasingly, things we talked with someone yesterday about, you can take large amounts of digital assets and create a life insurance policy around it. That generates yield. There are going to be ways to use the collateral that is being sucked into these companies to generate return for shareholders. This is why we keep making this point that not all digital asset treasuries are the same. Management is extremely important about how you, these are not ETFs. These are active vehicles with real humans on the inside pursuing business strategies. You are going to see a differentiation between management that's able to really operate on these strategies and ones that are not. Those are going to trade at vacillating premiums, we think, to the others. It's interesting. Each of those levers, which we kind of alluded to earlier, Charles, introduced some amount of risk. How do you mitigate that risk? It introduces risk, but it also introduces opportunity. If you have two DATs that just hold Ethereum, let's say, and one's two times NAV and one's at NAV, it's a no-brainer. You're going to short the one that's two times and buy the underlying, and you have a delta neutral pair trade to extract a return. If you are a DAT and your strategy is I'm just going to buy ETH and hold it, and it's just ETH plus yield, it's kind of a bad strategy. That's why at BTCS, we're a block builder. We account for anywhere between 2%- 3% of all transactions on Ethereum's blockchain. It's the major portion of our revenue growth. We're two years in development in doing this, and we've been running validators for five years. We see the vertical integration between our block building, our validation, and multiple other strategies, which I can't talk about, as well as using DeFi. When you start looking at all these things, we're actually going back to Sam's question, like we're contributing to the ecosystem. We're using the protocols and products. We're hiring developers. We're building. At the end of the day, if you want Ethereum to be truly valuable and tens of billions of dollars flow into DATs that just hold it and stake it and give it to like a Galaxy to go stake, none of that money is going to hire developers to build products and services that are actually going to make the underlying asset more valuable. I think we're almost doing a disservice to the ecosystem if we are not using a portion of that capital to build an operating business that's going to grow scalable revenue. That's where BTCS, we're the oldest public company in crypto, we've been highly focused on this for well before Michael Saylor was going to come on stage, had his DAT, well before anyone else in the public markets doing this. I think over time, when you look at these public companies with a treasury strategy, the value is going to go to the ones that have an operating business that drives scalable revenue and additional, if you want to call it, yield on your balance sheet. Otherwise, they're just going to trade near or slight premium to book because you're doing complex capital markets transactions to increase ETH per share or Bitcoin per share. The strength of the management team or of the existing operating business is something investors should pay close attention to. I think over time that's going to matter because just like Bitcoin miners, if you look at them in 2017, where you had Marathon, Riot that popped up, and now you have tons of them. Now, if you look at Sam, he's pivoted from Bitcoin mining into something else. How did those Bitcoin miners differentiate themselves? This one's got lower power. This one's using the waste heat to flare its greenhouse or whatever. As you look at these companies, there's going to need to be an operating business that has a value proposition. Otherwise, what's the point? You can just buy the ETF or you'll have games played with your stock in the public markets. What about the leverage risks that exist, Sebastian? How should investors think about that? Is that question specific for the next speaker? We're hitting at it. Yeah. I think everyone knows. What's the LTV of my credit? I don't want to talk about a public company's balance sheet. Although I will say, has anyone heard of Fortress? Yeah. Yeah, I get some nods and heads? OK, that's good. He hasn't. He said he hasn't. All right. Look, a casual observer would have noticed that Peter Briger joined the Board of Strategy at the beginning of July of this year. I think that's really important, actually, for the entire industry. Pete is focused on the left tail. He's a great investor. He's very well known. He's the Head of Fortress, for those that don't know, a $40 billion alternative manager. I think it's obviously like leverage is how things blow up. I mean, you increase your leverage, you increase the risk of ruin. Love, liquor, leverage, right? I think it's a good thing. It may be the case. Listen, I think the benefit of DATs in 2025 is we have seen incredible volatility in our sector already. This is the first institutional cycle for digital assets. It's happening right now, through legislation and regulation, and the lessons that we all learned in 2021. That was a leverage cycle for sure. I think Galaxy puts out a really good picture of the credit ecosystem in and around crypto. It's still candidly around in there. I mean, I don't know. I think their loan book, the aggregate loans that are out in crypto are. 40 billion? Not even. I think it's like $25 billion, right? Then if you look at DeFi, TVL, that's $150 billion, right? If you take all those numbers versus the total market cap of the industry, you know we're still probably, and this is probably in a healthy space, right? One could make the argument that this cycle is different in many different ways. One, in particular, because of the U.S. The leverage today is still below the leverage that we saw last cycle with higher market cap, right? We're in a much healthier place. We haven't passed the other half of this duo in legislation. Genius is the law of the land. That's great. We have legal programmable money. That is a game changer, right? That's why you're seeing corp chains for stablecoins, et cetera, because people see an unbelievable opportunity. They might be right or wrong, but I think that's interesting. What might come next? That might be what you might be worried about, right? I don't see today in the, I mean, sure, there's been a lot of DATs created, and that's caused some concern in capital market participants. If you look at the leverage side, the numbers are really not that concerning now. It's nothing like the credit crisis that we saw in 2022, where you had a lot of under-collateralized loans, or even if they were over-collateralized, they were colla... Tokenize that look. Even if they were over-collateralized, it was fucked up the collateral, like FTT or something. Yeah, no, this is a much healthier capital markets for crypto today than we have seen if you go back to the prior cycle. Now, you know what markets do, right? They run until they stop. It would be surprising to see this cycle end here, given leverage is below prior peaks by a lot. We haven't seen the final bits of really important legislation come through. That's going to drive a lot of activity, most likely on these chains. We still need the regulatory clarity to come through to really unlock that activity. Clarity is still something that may or may not get passed this year in D.C. I think it's famous last words, probably still early. Let's take the last few minutes and maybe think about what we should expect over the next three to six months as it pertains to the DAT ecosystem. We'll start with Charles and then go through the line of these fine gentlemen. I think there's two things I would point out. It seemed like I know there's a big deal today, but it seems like the deals are slowing a bit in terms of timing. I think that's driven by there's just been so many so quickly. If you look at some of the current deals, like for instance, like BTCS, we traded at a 65% discount to our NAV just based on cost. Sorry. Yeah, it sucks. We announced a $50 million buyback today, and we're paying a dividend because we have 14% short interest. If you look at all the Ethereum DATs, they're kind of close to book value. Some don't have operations, so you could kind of make that argument, but they still have yield. When you're looking at that, if new deals are going to come to market, how are you going to price a deal? From the people I've talked to, it looks like the investors want, depending on the token, if it's not a top token, and if it is a top token, it's a me too play because it's already been done. You're looking at smaller, obscure top 30 tokens, and they want a big discount. A lot of people don't want to do that. I think deals are going to slow until either the market turns. I think investors have gotten kind of smart on how to play these DATs in the public markets. That's why I think most of the Ethereum plays now have buybacks in place. We're doing a dividend for the same reason, actually payable in ETH, which is pretty cool. We're actually paying $0.35 a share to anyone that gets their shares out of street name. For example, Charles Schwab will lend all of your shares to short sellers and not pay you a dime and not disclose that they've done it. They make $400 million a year doing that. There are games getting played in the public markets today. I think as they've been brought to NAVs, it's going to be a little bit slower until that kind of clears up. I'll be brief. Winter is coming. Regulation is coming. You need to be ready for it. Specifically, assuming Clarity passes, almost every digital asset treasury in the U.S., if that is the core business, will end up having to be a commodity pool operator. Aside from the August panel I have here, most people in the digital asset treasury space don't know what a CPO is. That's not great, but they're going to figure it out. Regulation is coming. The impact of Clarity, I think, is not fully well understood. Clarity, as written, caps ownership at 20%. If you go over 20%, then your blockchain is a non-mature blockchain. You have to have enhanced disclosure with the SEC. If you stay in that box for too long, the SEC can turn around and call you a security. That means to me that the tail end, the low cap DATs don't make a heck of a lot of sense because where's that business going to go? Yeah, I think we are going to see the wave grow much, much bigger. I think it's going to be the next phase of the wave. We're going to see many, many more DATs internationally. We're going to see many more use cases. When you have the likes of NASDAQ now announcing that it's going to be tokenizing securities as assets, we're going to see more and more of this tokenization happening. You're going to see a lot of real-world asset tokenization plays starting up as well. That's my belief, and that's what we're seeing on the other side of the world. I think right now we're at a little bit of an oversupply period. I think the market needs to absorb it. I tend to be on the side of there's a lot more coming. When we zoom out from a GSR perspective, we just see tremendous innovation at the ground level and tremendous demand for crypto, both at the retail and at the institutional level. We think that's going to grow. What does this really look like to us right now? It looks like we're testing the pipes between crypto and traditional finance that was made possible by kind of an easing of the regulatory posture in the United States. Those pipes are just going to grow. We see it with the growing participation of everyone in this room. I'm back wearing suits. I haven't worn suits for five years. It's an incredible new influx of participants and interest. It's a lot of Bitcoin and ETH now, but I expect you all to start learning more about new tokens and new projects, people coming to market and looking to use this new technology. We're super excited. The market could always pause and vacillate, but a lot more coming. 40 seconds. I think Ethereum is going to go up. Hi Michael. I think AI is going to continue to transform society. Bit Digital is the only public company, as far as I know, who has direct exposure to both Ethereum and artificial intelligence. We're really happily positioned for the next three to six months. Perfect. Thank you guys so much. Appreciate your time.