Experts divided over DAT asset sales…"Market normalization" vs "Death Spiral"

Concerns are growing about the digital asset treasury (DAT · Digital Asset Treasury) business. Some treasuries have been selling their held digital assets to buy back their own shares. However, some argue these measures are part of market normalization.

On the 3rd (Korean time), according to crypto outlet The Block, ETH treasury ETHZilla recently sold about $40 million worth of Ethereum to fund share repurchases.

The Ethereum sales were carried out to alleviate the phenomenon of shares trading at a discount to net asset value (NAV). ETHZilla stated it "will continue selling ETH until the NAV gap narrows."

Quinn Ho, Head of Investments at GSR, said, "Selling some ETH to increase shareholder value when the stock is deeply discounted relative to assets is reasonable," and called it "not an abnormal signal but a process of value readjustment."

However, some experts warned that asset sales could expose weaknesses in the DAT business model. Michael Buscella, co‑founder of Neoclassical Capital, warned, "If the assets are not highly liquid like Bitcoin (BTC), Ethereum, or Solana (SOL), selling and then buying back can be risky," adding that "DATs focused on small tokens could lead to a 'Death Spiral.'"

Experts emphasized that the soundness of DATs depends more on capital management and revenue structure than on whether assets are sold. Matis van Es, a partner at Maven 11, explained, "If a DAT merely holds assets without generating returns, operational costs can erode asset value," and said, "transitioning to a revenue-generating DAT is the long-term solution."