Ethereum News Today: DATs' Survival or Systemic Risk? Crypto Market's Structural Test Intensifies

The crypto market's latest correction has exposed vulnerabilities in the flywheel strategies of digital asset treasury (DAT) companies, with JPMorgan analysts attributing the downturn to retail selling of Bitcoin and Ethereum ETFs. Roughly $4 billion has been pulled from spot BTC and ETH ETFs this month, outpacing February's record outflows and contrasting with $96 billion in equity ETF inflows according to data. This divergence highlights how retail investors treat crypto and equities as separate asset classes, despite both being risk-on investments.

The fallout extends to DAT firms like Michael Saylor's Strategy Inc., which now faces a potential $2.8 billion outflow if excluded from major indices such as MSCI USA and Nasdaq 100 according to Bloomberg. JPMorgan analysts warned that index removal would undermine liquidity, funding costs, and institutional credibility for companies whose crypto holdings constitute 50% or more of total assets according to Investing.com.

Strategy's market value has plummeted over 60% since its November 2024 peak, with its mNAV ratio (enterprise value to Bitcoin holdings) now just 1.1 according to Investing.com. The company's aggressive buy-the-dip strategy-funded by stock sales and debt-has left it exposed to market volatility as crypto prices remain below key support levels.

Ethereum's largest treasury company, BitMine, is also under pressure. With $3 billion in unrealized losses on its 3.56 million ETH holdings, the firm's mNAV has dropped to 0.86, raising questions about its ability to sustain buying pressure. While BitMine relies on staking rewards and Bitcoin mining to generate cash flow, the Ethereum staking yield has fallen to 2.9% APR from 8.6% in mid-2023, eroding a key revenue stream. Competitors like SharpLink and ETHZilla have scaled back purchases or sold assets to stabilize share prices, signaling a shift from broad-based accumulation to survival mode according to Bitget.

Meanwhile, DeFi lending hit a record $73.6 billion in Q3 2025, with on-chain protocols capturing 66.9% of the market. Aave, the leading DeFi lender, now holds 68.8% of the Plasma blockchain's lending market, while Tether dominates centralized finance (CeFi) with $14.6 billion in secured loans according to Yahoo Finance. This growth contrasts with the struggles of DATs, as liquidity and speculative fervor wane.

Polymarket, a prediction market platform, aims to capitalize on crypto's volatility with a $12 billion fundraising target according to LiveBitcoinNews. The firm's return to the U.S. market and partnerships with UFC and NHL underscore its ambition to bridge traditional and digital finance. However, its expansion faces stiff competition from Kalshi and regulatory uncertainty, reflecting broader risks in the sector.

As the DAT flywheel stalls, the market's reliance on a few large buyers like BitMine and Strategy Inc. has become a precarious foundation. With ETF outflows, index exclusions, and staking yields declining, the crypto narrative faces a structural test. Whether these firms can weather the storm-or if their collapse triggers a deeper correction-remains to be seen.