According to investment bank B. Riley, the cryptocurrency market is up about 10% since November 20, with Ether-related Digital Assets Treasury Company (DATCO) being the biggest beneficiary.
The bank linked the gains to an improved risk appetite after comments from the European Central Bank (ECB) reignited talk of a gradual shift away from the US dollar as its main reserve currency, along with expectations for interest rate cuts.
Across the 25 DATCOs tracked by the bank, the group’s median mNAV has increased from 0.9x to approximately 1.0x since the last update, and the average has also increased from 0.9x to approximately 1.0x.
mNAV compares a company’s enterprise value (EV), which is calculated by subtracting cash from its market capitalization and debt, with the market value of its virtual currency holdings.
Analysts Fedor Shabalin and Nick Giles said in a note on Wednesday that the performance is skewed towards leverage-like movements against crypto prices.
Since November 20th, analysts have said that Bitcoin BTC$91,817.11 Finance companies earn about 20% on average. Ethereum$3,317.01 The Russell 2000 stock index rose about 7%, while U.S. Treasuries rose about 28% and SOL Treasuries rose about 12%. Over the same period, the underlying token appreciated by 7% BTC$91,817.1113% Ethereum$3,317.01 and 4% sol$137.05respectively.
The bank’s analysts reiterated their view that DATCO’s recovery hinges on two catalysts: stabilization of the broader crypto market and companies implementing initiatives to increase return on equity to generate yield.
With both companies performing mostly well, analysts are highlighting Bitmine Immersion Technologies (BMNR) and rating it a buy with a price target of $47. The company’s stock price has risen 51% since November 20, compared with a 28% rise in ETH-focused DATCO and a 7% rise in the Russell 2000.
The bank said BMNR and Sharplink Gaming (SBET) remain the most constructive within the scope and are rated Buys with a price target of $19, describing them as the two largest ETH DATCOs pursuing staking and restaking strategies.
B. Riley also pointed to FG Nexus (FGNX), Sequans Communications (SQNS), and Kindly MD (NAKA) as valuable opportunities that trade at a discount to mNAV despite operating businesses.
read more: B. Riley lowers target price of digital asset treasury company as crypto recession worsens
