Why Non-Dilutive Yield Is Critical for Bitcoin Treasury Companies

Bitcoin digital asset treasuries (BTC DATs) have made their decision. They will be judged primarily by one metric: “Bitcoin per share.”

This public market version of “whoever has the most Bitcoin wins” marks a new era of Bitcoin adoption and activation.

As for what’s next, there remains a clear fork in the road. How will BTC DATs actually grow Bitcoin per share?

Whether through dilutive financial engineering or non-dilutive yield and operations, the path forward may determine whether DATs become a zero-sum, winner-takes-all contest or a positive-sum expansion of Bitcoin utility.

The Brilliance of BTC DATs

When Bitcoin is put into a DAT, the holder has more tools at their disposal than if it were in a cold wallet.

Specifically, public markets open the door to two major toolsets for BTC DATS:

Income generation: Operations that generate income to earn or purchase more BTC.
Financial engineering: Debt, leverage, and other tools to restructure balance sheets.

While most public companies are known primarily for their income generation, BTC DATs have so far focused primarily on financial engineering.

Strategy (MSTR) is the first and clearest example of a BTC DAT using financial tools to grow Bitcoin per share. Saylor has created a slew of synthetic Bitcoin financial products for Wall Street. STRK, STRF, STRD, and STRC are all products Strategy has carved from its Bitcoin balance sheet.

Wall Street loves these products as they allow them to speculate on Bitcoin in previously unavailable ways. In return, they’ve rewarded MicroStrategy with cheap financing, which MicroStrategy has used to buy more BTC.

Saylor’s successful Strategy has awoken several Bitcoin entrepreneurs who realized that putting their BTC in a DAT can be like putting Tony Stark in the Iron Man suit.

At the same time, it’s important to note that wrapping Bitcoin in a stock is not a fast pass to the end game. It’s very much the beginning of a journey with many potential pitfalls.