(Sherwood Media)

Ethereum treasury firms are having a “bad time” as many fall below the value of their stockpile

Since October, BitMine, ETHZilla, SharpLink Gaming, and several other treasury firms’ stock prices have performed worse than ethereum itself.

Sage D. Young

11/11/25 10:24AM

The overall performance of digital asset treasury firms (DATs) focused on ethereum has been significantly down as shares of these firms are performing worse than their underlying asset in Q4.

Since October, the price of ethereum has dropped 18% to under $3,500 as of Tuesday morning.

Shares of BitMine Immersion Technologies and SharpLink Gaming — the two largest ethereum stockpiling companies — have fallen 20.2% and 31.2%, respectively, in the period. ETHZilla has slid 23.5%, BTCS Inc. has slumped 38.7%, and FG Nexus has decreased nearly 46%, data from crypto analytics firm Artemis shows.

The price action comes as their basic mNAV — a metric that refers to the market capitalization of these firms relative to the value of their crypto asset holdings — is below 1, according to Blockworks Research.

“An mNAV under one limits the ability for DATs to perform accretive dilution, which is the principle that permits DATs to purchase more underlying assets and fulfill their mandate of increasing the asset value per share,” per Gurnoor Narula, a research analyst at Placeholder VC.

Narula told Sherwood News, “DATs start showing cracks when they aren’t able to close that mNAV gap, either because they’ve run out of funds to do so, or the underlying asset is distressed such that investor confidence has waned.”

Bitcoin powerhouse Strategy has also suffered, declining 26% since October 1, though its mNAV stands just above 1.

Optimism remains, but not deploying any more capital

Kenetic, a blockchain venture capital firm that invested $5 million in ETHZilla, is not deploying more funds at this point, the investment firm’s founder and managing partner, Jehan Chu, said to Sherwood.

However, Chu remains confident in the digital asset treasury model and is “optimistic that when interest rates are lowered and crypto experiences a push, we will see a corresponding surge in DATs including ETHZilla.”

Chu continued, “DATs provide leverage on the underlying assets. In good times it’s great and in bad times it’s terrible — we’re just passing through a bad time.”

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Altcoins have given back the majority of their gains since the Iran war began

While crypto altcoins outperformed for a long stretch after the outbreak of the US war with Iran, the asset class has retraced this past week.

XRP, solana, and ethereum have each dropped more than 6% in the past seven days as the total market capitalization for all of crypto (including bitcoin) has shed roughly $44 billion in the period, per CoinGecko.

Ethereum ETFs have also registered daily consecutive outflows for the past seven days, totaling more than $392.1 million. The last time these investment vehicles had such a streak was in December when ethereum decreased from $3,221 to $2,995, data from SoSoValue shows.

The Iran war was at first a positioning shock that saw crypto thrive, in part because the asset class was “lightly owned,” according to Fredrick Collins, CEO of crypto analytics platform Velo.xyz.

“Now as more concrete and persistent concerns about economic impacts have materialized, it’s not surprising to see crypto struggling as well,” Collins told Sherwood News. “In the face of cyclical (rather than transient) worries for risk assets in general, it’s not realistic to expect crypto to remain unscathed. And so we’ve unfortunately just not seen that initial relative strength in crypto continue to play out.”

Meanwhile, traders are expecting the price of ethereum to decline further this year. Prediction market-implied odds of the cryptocurrency sliding below $1,750 are at 81%, while the probability of the token tumbling under $1,500 stands at 68%, an increase from 52% on Monday.

(Event contracts are offered through Robinhood Derivatives, LLC — probabilities referenced or sourced from KalshiEx LLC or ForecastEx LLC.)

A drop to $1,457 would liquidate about 162,870 ethereum tokens’ worth of leveraged long positions, worth $323.3 million on Hyperliquid, per CoinGlass.

Slater Santer, a research analyst at trading firm GSR said, "Short term, the market likely remains flow-driven and headline-sensitive. Without a stabilization in ETF flows, a cooling in oil, or a renewed bid in equities, it's hard to argue for a sustained bounce in alts."

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For the first time, Fannie Mae will allow mortgages to be backed by crypto

Fannie Mae, the government-backed mortgage finance giant, will start accepting mortgages backed by cryptocurrencies — namely bitcoin and Circle’s stablecoin, USDC.

Mortgage firm Better Home & Finance and US-based crypto exchange Coinbase Global are rolling out a new product that enables prospective homebuyers to pledge their digital assets as down payment collateral when obtaining a mortgage backed by Fannie Mae, The Wall Street Journal reported.

This means homebuyers can secure a standard conforming mortgage without liquidating tokenized assets, which potentially triggers a taxable event.

“If BTC drops in value, the mortgage terms remain unchanged, and no additional collateral is required. Market movements alone never trigger liquidation,” per a joint press release from Better and Coinbase.

“Token-backed mortgages originated by Better are designed in accordance with Fannie Mae guidelines and remain as standard conforming mortgage loans, identical to other conforming mortgages,” the announcement continued.

Max Branzburg, head of consumer and business products at Coinbase, said, “Token-backed mortgages are a major first step to unlocking homeownership for the younger generations that have struggled with barriers to saving for a traditional downpayment.”

The announcement comes more than nine months after William Pulte, the director of the Federal Housing Agency, ordered Fannie Mae and Freddie Mac to prepare a proposal that considers cryptocurrency as a reserve asset in single-family mortgage loan risk assessment.

Fannie Mae to Accept Crypto-Backed Mortgages for the First Time

This means homebuyers can secure a standard conforming mortgage without liquidating tokenized assets, which potentially triggers a taxable event.

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The expiries create a gravitational pull in the days leading up to them as market makers hedging their books push bitcoin’s price toward “max pain.”

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GameStop transfers all but 1 bitcoin to Coinbase as collateral

It’s been one year since GameStop added bitcoin as a treasury reserve asset, but the company has since halted its accumulation strategy, joining a fray of companies pivoting away from HODLing the cryptocurrency.

The gaming and collectibles retailer was at one point the 21st-largest bitcoin treasury company, but has since dropped to 190th after pledging all but one of its 4,710 bitcoin as collateral for its covered-call strategy with Coinbase Credit, data from Bitcoin Treasuries shows. Earlier this year, GameStop moved 51% of its bitcoin to Coinbase Prime, triggering speculation that it would offload the asset.

Coinbase Credit has the “right to rehypothecate, commingle, or unilaterally sell the Pledged Bitcoin,” per GameStop’s 10K filing with the SEC on Tuesday. “As a result of these rights, we concluded that control of the Pledged Bitcoin transferred to the counterparty. Accordingly, we derecognized the Pledged Bitcoin as an intangible asset.” That said, GameStop also “recognized digital assets receivable of $368.3 million... representing our contractual right to receive equivalent amount of Bitcoin in the future.”

GameStop sold covered‑call option contracts, which have strike prices ranging from $105,000 to $110,000 and maturities extending through March 2026, to mitigate its exposure to bitcoin’s price volatility and generate incremental yield.

The move comes as a number of other bitcoin firms have reached a tipping point and sold part of their stockpile.

Empery Digital, the 23rd-largest bitcoin treasury firm, announced in a March press release that it sold $4.2 million worth of BTC to fund share repurchases. DL News also reported that a shareholder who owns 9.8% of Empery Digital demanded the company sell its entire bitcoin stockpile and the immediate resignation of its CEO and entire board of directors.
GD Culture Group approved the sale of an unspecified amount of its 7,500-bitcoin reserve to fund its share repurchase program, according to a press release last month.
Elsewhere, Cango sold 4,451 BTC to reduce its overall finance leverage and strengthen its balance sheet, while Riot Platforms sold around $200 million worth of bitcoin in November and December.

Despite GameStop’s pledge to Coinbase Credit, the company has technically left the door open to resume its bitcoin strategy: the gaming firm said it intends to use net proceeds from its convertible 2030 notes for general corporate purposes, including the acquisition of bitcoin.

Shares of GameStop are up 2.7% today after posting lackluster Q4 results yesterday.

The move comes as a number of other bitcoin firms have reached a tipping point and sold part of their stockpile.

Empery Digital, the 23rd-largest bitcoin treasury firm, announced in a March press release that it sold $4.2 million worth of BTC to fund share repurchases. DL News also reported that a shareholder who owns 9.8% of Empery Digital demanded the company sell its entire bitcoin stockpile and the immediate resignation of its CEO and entire board of directors.
GD Culture Group approved the sale of an unspecified amount of its 7,500-bitcoin reserve to fund its share repurchase program, according to a press release last month.
Elsewhere, Cango sold 4,451 BTC to reduce its overall finance leverage and strengthen its balance sheet, while Riot Platforms sold around $200 million worth of bitcoin in November and December.

Shares of GameStop are up 2.7% today after posting lackluster Q4 results yesterday.

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Sherwood Media, LLC produces fresh and unique perspectives on topical financial news and is a fully owned subsidiary of Robinhood Markets, Inc., and any views expressed here do not necessarily reflect the views of any other Robinhood affiliate, including Robinhood Markets, Inc., Robinhood Financial LLC, Robinhood Securities, LLC, Robinhood Crypto, LLC, Robinhood Derivatives, LLC, or Robinhood Money, LLC. Futures and event contracts are offered through Robinhood Derivatives, LLC.