Ethereum treasury companies are proving to be a better investment option than ETH ETFs since their net asset value (NAV) multiples have started to normalize above 1, according to Geoffrey Kendrick, the global head of digital asset research at Standard Chartered.
He stated, “The treasury companies have ETH as a treasury asset, making them a more attractive buy compared to US spot ETH ETFs since NAV multiples are just above 1.”
NAV is calculated by dividing the market cap of a treasury company by the total amount of Ethereum held.
He further explained, “The treasury companies are investable, seeking upside exposure to ETH price appreciation, increasing ETH per share, and now the net asset value multiple normalization is good for staking rewards.” I believe these companies are allowing investors to legally bypass unfavorable regulations, which is why I think the NAV multiple will not fall below 1.
Most ETH treasury companies generate yields by staking and distributing their funds across decentralized finance (DeFi) protocols, unlike ETH ETFs in the United States, which do not offer these features.
Kendrick noted that Ethereum treasury companies have purchased 1.6% of the ETH in circulation since gaining popularity in June, equaling the amount bought by their ETF counterparts.
BMNR and SharpLink Gaming (SBET) reported holdings of over 833,100 and 521,900 ETH, respectively, while US spot Ethereum ETFs saw inflows again on Tuesday, pulling in $73.22 million, according to SoSoValue.
SharpLink raised $425 million through a private placement and switched to an ETH treasury strategy in May. It has since applied to the Securities and Exchange Commission (SEC) to expand its ATM facility to $6 billion. Since the launch of its treasury in June, the company, which stakes almost all of its holdings, has also reported an increase in total staking rewards to 929 ETH.
With a 521,939 ETH holding, SharpLink trails BitMine (BMNR), backed by Peter Thiel, on the list of publicly traded companies aiming to create a treasury vehicle for the leading altcoin. Bill Miller and Cathie Wood’s ARK Invest are significant stockholders of BitMine, which disclosed holdings of more than 833,100 ETH on Monday.
Consequently, the total amount of ETH treasury vehicle holdings has increased to over 10.9 million ETH. Record outflows in US spot ETH ETFs have been followed by ongoing buying pressure from ETH treasury companies.
Recent market action suggests that if ETH stays above the support of a lower rising trendline extending from June 22, it may be ready to retest the resistance of a descending trendline near $3.9K.
Ether must remain above the $3,220 support level to validate such a bullish outlook, which is reinforced by the 50-day Exponential Moving Average (EMA). The consolidation could indicate the formation of a bullish pennant.
Confirming the bullish pennant pattern will require flipping the resistance of the descending trendline and moving above the key selling pressure around $4.1K.
The Stochastic Oscillator (Stoch) and Relative Strength Index (RSI) are not offering clear direction near their neutral levels, indicating market participants are uncertain about their next move.
However, the altcoin faced a similar situation in December 2024. The Net Taker Volume at that time saw a significant decline, and ETH was trading near this same resistance area. Subsequently, the price dropped sharply by 66 percent, falling into its 50-week (red wave) and 200-week (blue wave) exponential moving averages (EMA). If ETH retests the $3,600–$4,000 resistance,
Net Taker Volume decreases, and the weekly relative strength index (RSI) cools from overbought; a similar scenario might unfold. Like the decline in late 2024, the combination of bearish signals increases the chances that ETH will retreat toward its 50-week and 200-week EMAs, currently at $2,736 and $2,333, respectively, by September or October.
Net Taker Volume decreases, and the weekly relative strength index (RSI) cools from overbought; a similar scenario might unfold. Like the decline in late 2024, the combination of bearish signals increases the chances that ETH will retreat toward its 50-week and 200-week EMAs, currently at $2,736 and $2,333, respectively, by September or October.