Monthly investments into digital asset treasury (DAT) companies dropped drastically in May, amounting to $180 million—the lowest monthly total since October 2024—according to DefiLlama data. This represents a steep decline of roughly 95% from April’s $4.4 billion inflow and about 93% below the average monthly levels observed in the first five months of the year.
The dramatic slowdown follows strong inflows in March and April, which saw $4.2 billion and $4.4 billion, respectively. Bitcoin-focused treasury companies dominated May’s activity, receiving nearly $177 million or 98% of the total inflows, though that figure marks a significant drop from the $3.8 billion they attracted in April. Other digital assets such as ZCash, Story, and Sui contributed modestly, while Litecoin actually experienced an outflow of nearly $1.9 million.
This reduced demand signals a shift in investor appetite as the appeal of passive crypto treasury models wanes. These companies typically operate by raising capital to accumulate tokens with minimal active management. However, pressures from exchange-traded funds (ETFs), narrowing net asset values (NAV), and the growing need to deliver yield have challenged the viability of simply holding digital assets without deploying them strategically.
Industry voices have noted this change in landscape. Galaxy Digital described the “raise-and-hold” era as over, suggesting that treasury companies must adopt active management approaches such as staking, validator infrastructure, or decentralized finance (DeFi) strategies to attract investors. This shift comes amid growing skepticism toward passive holdings as ETFs offer a more liquid and cost-efficient exposure to cryptocurrencies.
Supporting this view, staking infrastructure provider Everstake pointed out that ether-focused treasury firms now face mounting pressure to generate staking-related revenue. Their analysis revealed that staking income composed an average of 60% of reported revenue among six public treasury firms that disclose such data, highlighting how critical yield generation has become in a market adjusting to new financial dynamics.
However, experts caution against attributing the shift solely to the rise of ETFs. Arthur Firstov from Mercuryo emphasized that ETFs introduce a structural cap on how much premium treasury companies can command, requiring continuous justification for valuations. Still, company-specific issues like equity dilution, operational expenses, balance sheet losses, and overall market risk sentiment also significantly influence investor behavior and trading discounts or premiums for these firms.