The rise of crypto treasury 2.0: Why corporate crypto balance sheets are evolving beyond holding

As of September 30, 2025, over one million BTC now sit on corporate balance sheets worldwide, led by MicroStrategy’s ~640,000 Bitcoins, roughly 3% of total supply. Ethereum treasuries are catching up fast, with public firms controlling over 4 million ETH,  a growing share of the network (~3%).

Yet the model has clear limits. A pure buy-and-hold approach is entirely tethered to Bitcoin’s price cycle, exposing treasuries to volatility and offering little control over outcomes. More importantly, it’s no longer differentiating. Any company can hold Bitcoin, but few can manage it strategically. As capital markets mature, investors now reward firms that pair conviction with sophistication: disciplined risk management, income generation, and transparent reporting.

That shift marks the rise of Treasury 2.0: balance sheets that don’t just hold assets, but actively manage them. And increasingly, Ethereum, Solana, and stablecoins are entering the mix, not just as a hedge, but as a productive, programmable reserve that can earn yield and integrate with core business operations.

In this edition of The WIRE, we unpack Treasury 1.0’s legacy, why buy-and-hold is no longer enough, and the toolkit of Treasury 2.0.

To explore how digital assets are reshaping treasury design, from operational efficiency to the emergence of Digital Asset Treasury Companies (DATCOs), download our full white paper, “Treasury in the Age of Digital Assets”.

BTC Treasury 1.0 - The (Micro)Strategy model

The modern era of corporate crypto treasuries began in August 2020, when MicroStrategy (now rebranded as Strategy) announced it will convert a large portion of its reserves into Bitcoin. What started as a hedge against inflation quickly became the company’s defining strategy. Over the following years, Strategy raised billions through equity offerings and convertible debt to acquire Bitcoin, amassing more than ~640,000 BTC as of September 2025, roughly 3% of total supply.

Between 2020 and 2025, Strategy’s stock has surged more than 3,000%, at times trading at nearly 3x the net asset value of its Bitcoin holdings. Investors aren’t just buying Bitcoin exposure; they are paying for the company’s privileged access to capital markets, its ability to scale accumulation, and its role as a proxy for digital assets in equity portfolios.

The model works because it turns balance sheet management into capital markets strategy. By issuing new equity and convertible debt at a premium to book value, Strategy creates a self-reinforcing flywheel: rising share prices enabled new fundraising, which funds more Bitcoin purchases, increasing Bitcoin-per-share and further driving investor demand. This “wrapper premium” is transforming a software business into a publicly traded Bitcoin operating company, bridging the gap between institutional capital and digital assets.

For investors, this represents a new kind of corporate exposure, one where the balance sheet is the business. Management’s conviction, execution discipline, and financing skill become the differentiators, creating a form of management alpha that few could replicate.

The results were contagious, and other corporations followed, with many branding themselves around Bitcoin treasury strategies. By mid-2025, more than 180 public companies and 60 private firms worldwide reported Bitcoin holdings, together controlling over 1 million BTC.

An overview of digital asset treasury sector - Digital asset treasuries have become a $100B+ phenomenon, with corporates like Strategy (MicroStrategy), Metaplanet, and SharpLink Gaming leading the charge. DATCOs now hold nearly 800k BTC (~4% of supply) and over 1.3M ETH (~1% of supply), proving that treasuries are no longer passive reserves but strategic balance-sheet assets. The trend is global - from the U.S. to Japan - underscoring how digital assets are reshaping corporate finance. Source:Galaxy

But the model’s limits are becoming clearer. Bitcoin accumulation alone no longer differentiates one balance sheet from another. With more companies adopting the same playbook, capital markets are looking past conviction to execution quality,  how firms finance, hedge, and actively manage their holdings. The message from investors is clear: it’s not what you hold, but how you manage it that creates value.

In short, Treasury 1.0 proved that digital assets could anchor a corporate balance sheet and attract capital. But it also revealed the fragility of a strategy built solely on accumulation.

Why buy-and-hold won't cut It: The demand for sophistication

As the crypto treasury phenomenon matures, stakeholders are demanding more than a passive "HODL" strategy. The market is shifting from rewarding companies simply for announcing crypto holdings to expecting active stewardship of those assets. Several factors are driving this change:

1. Risk management: With Bitcoin's annualized volatility exceeding 50%, a pure buy-and-hold strategy exposes firms to significant balance sheet swings. The development of robust crypto derivatives markets now provides tools for hedging against downturns, and a modern crypto treasury is expected to have an active risk mitigation plan.
2. Asset productivity: Large, idle crypto holdings represent an opportunity cost. Forward-looking firms are now finding ways to put these assets to work to generate additional returns through lending or staking. This marks a shift from a passive approach to one where treasurers actively seek yield from their holdings.
3. Capital efficiency and liquidity: Unlike the static Bitcoin hoard of Treasury 1.0, the new model emphasizes liquidity planning. This includes using stablecoins and tokenized short-term debt as institutional-grade cash equivalents that can earn yield while remaining highly liquid.
4. Governance and transparency: As treasury strategies become more complex, investors demand greater transparency. Firms are responding with formal treasury committees and more frequent, detailed disclosures on holdings and returns, building confidence that active strategies are being pursued responsibly.

The bottom line: markets no longer reward static exposure. To justify the risks of holding volatile assets, treasurers must demonstrate active stewardship: thoughtful acquisition planning, hedging downside, generating income, ensuring liquidity, and reporting with discipline. Buy-and-hold was Treasury 1.0. The next phase, Treasury 2.0, is about engineering balance sheets that can perform through cycles.

Treasury 2.0: A broader toolkit for a dynamic strategy

"Treasury 2.0" is about leveraging a richer set of financial tools, both traditional and crypto-native, to actively manage and enhance crypto balance sheets. It’s a move from a static allocation to a dynamic, engineered approach.

Key elements include:

1. Creative debt and equity financing


MicroStrategy set the template by raising billions through convertible bonds, preferred equity, and even Bitcoin-backed loans. This playbook is now broadening: corporates are tapping traditional debt markets, issuing equity hybrids, or even creating structured notes linked to BTC reserves. The goal isn’t just accumulation, it’s capital efficiency, using financing structures to scale exposure without overextending liquidity.

2. On-chain financing and tokenized debt

Treasury 2.0 is also about new issuance channels. Companies can raise capital directly on-chain through tokenized bonds and commercial paper. Siemens and Société Générale have already issued digital bonds, while OCBC Bank launched tokenized corporate debt under MAS regulation in Singapore. On the asset side, treasuries can park surplus cash into tokenized T-bills, yielding 4–5% annually with same-day liquidity. For treasurers, this is a breakthrough: cash equivalents that are programmable, globally accessible, and trade 24/7.

Top Tokenized Treasury Bills (T-Bills) Coins by Market Cap

The tokenized treasury bill market now tops $1.35B, growing 5% in the past 24 hours. USTB dominates issuance, but competition is emerging from products like EUTBL, THBILL, and NBASIS. For corporate treasurers, this signals a new frontier: on-chain T-bills are becoming a credible alternative to money market funds, offering yield, liquidity, and 24/7 settlement, a core building block of Treasury 2.0. Source: Coingecko, as of October 2,202

3. Structured yield and DeFi strategies

Passive reserves are being reimagined as income streams. Companies are beginning to implement options-based strategies - such as covered calls and put selling - to harvest Bitcoin’s structurally high volatility for yield. Others are staking Ethereum or Solana, running validator nodes, or deploying stablecoins into regulated money market funds. Done responsibly, these activities turn treasuries into profit centers rather than cost centers.

Corporates now use a mix of lending, covered options, staking, and basis trades to turn volatile assets into predictable income streams. Each comes with trade-offs: lending adds counterparty risk, options cap upside, staking introduces lock-ups, and basis trades carry platform risk. But when applied with discipline, these tools transform idle reserves into productive balance sheets, shifting treasuries from passive buffers into active performance engines. Source: XBTO research.

Case in point: Volatility selling

One of the unique characteristics of digital assets is their structurally high volatility. Bitcoin’s realized and implied volatility is consistently two to three times higher than that of equities. While most investors see volatility as a source of risk, a treasury can treat it as a source of income.

XBTO’s Diamond Hands strategy is designed precisely for that. It uses an actively managed options-based framework to accumulate Bitcoin at attractive levels while generating yield:

1. Sell put options during periods of elevated volatility and earn premium income.
2. If Bitcoin falls, the company buys coins at lower, pre-agreed prices.
3. Hold long Bitcoin via perpetual futures when puts are exercised, increasing exposure at favorable levels.
4. Sell call options on excess holdings in recovery phases, locking in yield while managing upside risk.
5. The cycle then resets, turning volatility into a recurring opportunity.

Because the strategy monetizes volatility through premium collection, the effective cost of Bitcoin acquisition is reduced, and the company steadily accumulates more coins for the same capital outlay. Over time, this creates a compounding advantage.

Unlike a passive buy-and-hold approach, where the number of coins remains fixed and performance is driven solely by Bitcoin’s USD price, the strategy steadily increases coin holdings (~7% p.a. In BTC terms) over time while keeping volatility and drawdowns remarkably low (3.5% and -4% respectively). This quiet compounding in-kind creates a powerful effect: when the larger BTC balance is later translated into dollars, the gains are magnified. The result is materially higher USD returns than passive exposure (from 68% p.a. to 80% p.a.), achieved without adding meaningful risk in USD terms (volatility marginally increases from 67% to 68%).

1) Period of analysis: 31-Dec-2018 to 31-July-2025. Source: Company Data and CoinGlass. Performance metrics based on monthly returns. Performance numbers up until Dec-23 (inclusive) are simulated numbers net of fees. Hypothetical simulated performance results have certain inherent limitations. There is no guarantee that the market conditions during the past period will be present in the future.

4. Diversification across assets

Diversification in corporate treasuries is evolving from a risk-management exercise into a balance-sheet design strategy. The leading firms are no longer defined by what they hold, but by how each asset type serves a distinct financial purpose.

Bitcoin remains the cornerstone: a capped-supply, non-sovereign asset prized for its digital scarcity, liquidity, and inflation-hedge characteristics. It anchors credibility with investors and provides a durable hedge against monetary uncertainty, the digital equivalent of gold on the balance sheet.

Ethereum introduces productivity. As a proof-of-stake asset , it allows treasuries to earn native yield (3-5%) through staking while maintaining exposure to one of the world’s most widely used financial settlement networks. ETH’s programmability also unlocks participation in tokenized debt, stablecoin liquidity, and DeFi-based financing, turning reserves into active, income-generating capital.

Source: Crypto.com

Solana treasuries are also on the rise, reflecting demand for high-throughput networks and ecosystem participation.

Stablecoins complete the structure by providing price stability and operational liquidity. Pegged to fiat currencies, they serve as 24/7 settlement tools for payments, remittances, and short-term liquidity management. When allocated into tokenized T-bills or regulated money-market wrappers, they can even generate modest yields without sacrificing convertibility.

Digital asset treasury adoption

Bitcoin remains the dominant choice for corporate treasuries, adopted by more than 100 companies worldwide. Ethereum is closing the gap, with over 70 treasuries integrating ETH, reflecting its dual role as both a reserve asset and a yield-generating instrument. Solana is emerging as a distant third, while other assets like BNB,SOL, and XRP appear in only a handful of balance sheets. The takeaway: treasuries are diversifying, but BTC and ETH still account for the vast majority of adoption, underscoring their status as the core pillars of Treasury 2.0. Source: RR2 Capital.

The evolution is clear: Treasury 2.0 is the fusion of traditional corporate finance and digital-native tools - issuing debt, managing liquidity, hedging exposures, and generating income - but now executed on-chain and in real time.

The next wave:  ETH Treasuries and programmable balance sheets

The next frontier in corporate treasury management is not about replacing Bitcoin, but about broadening the balance sheet. If BTC has proven its value as a scarce, non-sovereign reserve asset, Ethereum is showing how treasuries can go further, turning reserves into productive, programmable capital.

Ethereum’s proof-of-stake system allows corporates to earn 3-5% annual staking rewards, effectively creating a built-in yield on holdings. This dual profile, growth potential plus recurring income, makes ETH behave more like a dividend-paying growth stock than a static reserve.

That’s why public firms now hold more than 4 million ETH, with leaders like BitMine Immersion (~1.7M ETH) and SharpLink Gaming (~797k ETH) integrating staking and validator operations into their treasury strategies. Transparency is also higher: firms like SharpLink publish weekly disclosures on their ETH activity, setting a new bar for governance.

What sets ETH apart is programmability. Treasuries can embed assets into smart contracts to automate liquidity, collateralize ETH to raise capital, or issue tokenized debt directly on-chain. In some cases, reserves even become part of the business model: Allied Gaming, for instance, framed its BTC and ETH treasury as the foundation for tokenizing tickets, IP rights, and revenue streams.

In this sense, corporate treasuries are evolving into multi-asset systems:

1. Bitcoin for scarcity and macro resilience.
2. Ethereum for yield and programmability.
3. Stablecoins and tokenized debt for liquidity and capital efficiency.

The result is not Treasury 1.0 versus 2.0, but a plural balance sheet, where different assets play distinct roles in creating resilience, optionality, and long-term value.

Treasuries as competitive advantage

Corporate treasuries are no longer judged by how much they hold, but by how effectively they manage what’s inside. The market premium once attached to bold Bitcoin bets is shifting toward firms that can show discipline, raising capital without overextending, hedging volatility, generating yield, and disclosing with real transparency.

The strongest balance sheets will be plural, not single-asset stories. Bitcoin will remain the anchor of resilience, but Ethereum’s yield and programmability are already redefining how reserves can work, while stablecoins and tokenized debt are emerging as the next generation of cash equivalents. The point is not to pick a winner, but to design treasuries where each instrument plays its role.

What sets the new leaders apart is optionality. In a world of shifting rates, volatile currencies, and geopolitical risk, the ability to move seamlessly between fiat, stablecoins, and digital assets is becoming a competitive edge. Balance sheets that “do” - not just “store” - are the ones that will define Treasury 2.0.