Written by: James Rubin
Translated by: Saoirse, Foresight News
Wall Street investment bank Bernstein noted in a Monday report that Ethereum treasuries differ significantly from Bitcoin treasuries in asset management: Ethereum treasuries generate yields through staking, but this process is accompanied by liquidity constraints and smart contract security risks, requiring enterprises to find a balance within the limitations of fund deployment.
Analysts believe these factors are key considerations for enterprises balancing Ethereum asset liquidity and "yield optimization".
Analysts stated: "If an Ethereum treasury stakes ETH to generate yield, while staking contracts typically have liquidity, unlocking sometimes requires queuing for days. Therefore, Ethereum treasury enterprises must find a balance between ETH liquidity and yield optimization. Additionally, more complex yield optimization strategies like restaking (such as Eigenlayer's restaking model) and DeFi-based yield generation still need to address smart contract security risk management."
Bernstein added: "The advantage of the Ethereum treasury model is that staking yields can bring actual cash flow to operations, but liquidity risks and security issues still require focused attention."
Staking refers to the process of pledging tokens to support network operations. Ethereum, Solana, and other Proof-of-Stake networks differ from Proof-of-Work systems like Bitcoin, which rely on resource-intensive mining operations.
Currently, more enterprises are beginning to build Ethereum treasuries. Bernstein mentioned that Ethereum-related enterprises, including SharpLink Gaming (SBET), Bit Digital (BTBT), and BitMine Immersion (BMNR), have collectively held 876,000 ETH as of July.
Last week, BMNR's Ethereum holdings exceeded $2 billion in value, and the company stated its goal is to hold and stake 5% of Ethereum's total supply. SharpLink holds over $1.3 billion worth of ETH.
"Driven by digital dollars and tokenized assets, the growth of internet financial economics will expand the Ethereum ecosystem's transaction and user scale (including Layer2 chains operated by platforms like Coinbase and Robinhood). As the underlying native asset, Ethereum is expected to realize value appreciation from this growth through staking yields generated by transaction fees and token buyback and burn mechanisms."
Ethereum briefly exceeded $3,900 in Monday trading, creating a new high since early December, before falling back. Over the past month, the asset has risen by over 50%, closely related to the rise of Ethereum treasuries, improvements in the Ethereum ecosystem after the GENIUS Act's passage, and market recognition of its application potential.
Multiple analysts predict that ETH might break its previous all-time high of $4,800 this year, with BitMEX founder Arthur Hayes even recently predicting ETH could reach $10,000 this year.
BitMine Immersion Chairman Tom Lee reported on social media platform X that based on research analysts' reset value, ETH could reach 18 times its current price, approximately $60,000. Of course, as a holding company, BitMine's prediction inevitably carries a bias of interest.
The Ethereum treasury model draws from Strategy's (formerly MicroStrategy) experience. After years of poor performance and low stock prices, the company transformed from software development to Bitcoin purchasing in 2020, with its Bitcoin holdings currently valued at nearly $72 billion. However, analysts noted that "Ethereum treasury risk management is more complex than the Strategy model".
Analysts stated: "Michael Saylor insists on keeping Bitcoin in liquid form on the balance sheet, not generating passive income through lending. Strategy extremely emphasizes asset-liability management (ALM) and liquidity management."
"And Strategy often adjusts between debt financing and equity financing based on market sentiment to maintain a conservative debt level."
