Cango's Bitcoin Treasury: A Pathway to Equitize Digital Gold?

The rise of Bitcoin treasury strategies in corporate finance has created a new frontier for value creation, particularly in the crypto mining sector. Cango Inc. (NYSE: CANG) stands at the intersection of this trend, leveraging its Bitcoin holdings and strategic diversification into energy and AI compute infrastructure to position itself as a compelling case study in valuation arbitrage. As of December 2025, Cango holds 7,528.3 BTC, with a market value exceeding $700 million, while its stock trades at a market capitalization of approximately $568 million. This discrepancy-where the intrinsic value of its Bitcoin treasury dwarfs its equity valuation-raises critical questions about the company's potential to equitize digital gold and redefine its role in the evolving crypto-asset landscape.

Valuation Arbitrage: The Case for Cango's Bitcoin Treasury

Cango's Bitcoin treasury strategy is rooted in a disciplined HODL approach, with the company accumulating BTC through both mining operations and strategic acquisitions. In 2025 alone, Cango mined 569 BTC in December and 1,930.8 BTC in Q3, averaging 18.35–21.0 BTC per day. These figures underscore the company's ability to generate Bitcoin at a cost of $81,072 per BTC (excluding depreciation) and $99,383 all-in. By comparison, the market price of Bitcoin in late 2025 hovered around $93,000, meaning Cango's mining operations yield BTC at a cost below market value-a structural advantage that amplifies its treasury's growth potential.

The valuation arbitrage becomes even more pronounced when considering Cango's equity price. Greenridge Capital recently initiated a "buy" rating on CANG, citing a price target of $4.00 and a 7x adjusted EBITDA multiple applied to 2026 estimates of $335.4 million in EBITDA. However, this analysis excludes the latent value of Cango's Bitcoin holdings, which could be unlocked through mechanisms such as Bitcoin-backed debt issuance or strategic partnerships. For instance, the U.S. Strategic Bitcoin Reserve's establishment in March 2025 has normalized institutional acceptance of Bitcoin as collateral, opening avenues for Cango to monetize its treasury without selling BTC-a move that aligns with its long-term HODL strategy.

Cango's "Energy + HPC" plan includes pilot projects in Oman and Indonesia, aiming to transition into AI compute infrastructure by 2026. This pivot is not merely speculative: AI workloads are projected to grow exponentially as enterprises adopt generative AI, creating a $1.5 trillion market by 2030. By integrating Bitcoin mining with AI compute, Cango can leverage its energy infrastructure to serve dual revenue streams-mining during low-demand periods and AI workloads during peak demand. This approach mitigates the cyclical risks inherent to crypto mining while capitalizing on the AI boom.

Industry Context: Cango's Position in the DAT Ecosystem

Cango's strategy must be contextualized within the broader rise of Digital Asset Treasuries (DATs), a category of public companies that raise capital to acquire and hold cryptocurrencies as primary reserves. Over 200 DATs launched in 2025, collectively raising $15 billion for Bitcoin and altcoin acquisitions. However, DATs face unique risks, including higher volatility compared to Bitcoin itself (e.g., MicroStrategy's 76% annualized volatility vs. Bitcoin's 39%). Cango's conservative HODL strategy and asset-light model differentiate it from speculative DATs, positioning it as a more stable player in the space.

Moreover, Cango's hybrid custody model-partially self-custodying its Bitcoin while avoiding full exposure to regulatory uncertainties-aligns with industry best practices. This approach balances security with flexibility, enabling the company to adapt to evolving regulatory frameworks such as the Digital Asset Market Clarity Act. By contrast, firms relying on third-party custodians face liquidity risks, as seen in the 2024 collapse of FTX's custodial services.

Risks and Considerations

Despite its strengths, Cango's strategy is not without risks. The company's reliance on Bitcoin mining exposes it to network difficulty fluctuations and energy price volatility. For example, its average operating hashrate declined slightly to 43.36 EH/s in December 2025, reflecting operational challenges. Additionally, the DAT sector's structural leverage-where stocks often underperform Bitcoin during sell-offs-could amplify downside risks for Cango if market sentiment deteriorates according to analysis.

However, Cango's diversification into energy and AI, combined with its disciplined treasury management, provides a buffer against these risks. The company's $10.5 million shareholder commitment in late 2025 further signals confidence in its long-term vision, suggesting a strong alignment of interests between management and investors.

Conclusion: A Mispriced Opportunity

Cango's Bitcoin treasury represents a unique confluence of valuation arbitrage and strategic diversification. With a $700 million BTC reserve dwarfing its $568 million market cap, the company offers a rare opportunity to invest in a business whose intrinsic value is not fully reflected in its equity price. Its pivot into energy and AI compute infrastructure adds a layer of resilience, positioning Cango to capitalize on both the crypto and AI megatrends.

For investors seeking exposure to Bitcoin's upside without directly holding the asset, Cango's equity presents a compelling case. However, success hinges on the company's ability to execute its diversification plans and navigate regulatory headwinds. As the line between crypto-native firms and traditional corporations blurs, Cango's journey may serve as a blueprint for equitizing digital gold in the 2026–2027 cycle.