Ethereum treasuries are facing challenges as market premiums for companies holding Ether have dropped drastically from 5x to below 1x, signaling the end of the speculative phase. Investors no longer see these companies as growth plays but as expensive wrappers for Ethereum itself. The collapse affects over four million Ether worth $22 billion held by 71 firms, with BitMine and SharpLink Gaming leading the market.

Bitcoin treasuries are also suffering as one in three public firms holding Bitcoin are trading below their premiums. Unlike Bitcoin treasuries, Ethereum treasuries do not use convertible debt strategies, causing immediate dilution of shareholders. Strategy dropped from a 1.8x premium to 1.29x, while Metaplanet crashed from 7.14x to 1.4x, indicating a significant decline.

Seven out of 17 Ethereum treasuries now trade below net asset value, with leaders like SharpLink Gaming and ETHZilla offering discounts. The mNAV metric measures whether a company’s stock price trades above or below the value of its crypto holdings. Bitmine, the largest Ethereum treasury, is investing in alternative opportunities, further complicating the situation.

Digital asset treasury volumes peaked in mid-August but dropped 55% by September due to declining interest in exchange-traded funds and the rise of other treasuries like Solana and Avalanche. Ethereum treasuries’ trading volumes have collapsed, impacting mNAV. The market awaits the Federal Reserve’s decision on interest rates, expecting consolidation in the future.

The distribution of Ethereum treasuries leans towards mid-sized players, with a few dominant whales controlling most flows. While consolidation is expected, Ethereum treasuries are less likely to face liquidation risks compared to Bitcoin treasuries. Momentum for Ethereum treasuries may improve if Ethereum reaches an all-time high again.

Read more at Yahoo Finance: ‘Winner takes most’ era dawns for Ethereum treasuries as euphoria wanes