Dan Morehead

Digital asset treasury companies are procyclical and many now trade below net asset value; when crypto markets regain momentum and hit new highs, most of these treasury companies should trade up to or above their NAVs, with strong performers consolidating weaker ones.

Unsustainable U.S. fiscal deficits and paper-money debasement are driving investors into hard assets. Bitcoin has a fixed supply of 21 million and cannot be printed, and it has historically risen about 70% per year while paper money loses purchasing power at 3.4% annually; gold and other hard assets benefit from the same lack of a real fiscal exit.

Morehead notes that while "crypto natives" are active, the median institutional holding is still 0.0%. He explicitly names BlackRock (BLK) and Bank of New York (BK) as the pioneers who have built the rails. As the market matures and the "hype" settles into utility, the remaining 99% of institutions "have to cover their short" (i.e., move from 0% allocation). The incumbents who own the regulated infrastructure (custody, ETFs) will capture the fees from this multi-decade capital migration. LONG. Bet on the "picks and shovels" of institutional adoption. Regulatory caps on bank involvement in crypto; competition from crypto-native firms going public.