David Bailey: altcoin DATs "toxic," Bitcoin banking is future
Nakamoto Holdings CEO David Bailey said the “treasury sector” is being tested by toxic financing and “failed altcoins rebranded as DATs.” He argued that true bitcoin treasury firms are evolving into “Bitcoin banks” – balance‑sheet businesses that monetize BTC – drawing sharp pushback on X.
David Bailey, CEO of Nakamoto Holdings, said the crypto treasury category is having a reckoning. In a Sept. 14 post on X, he criticized “toxic financing,” “failed altcoins rebranded as DATs,” and companies “with no plan or vision,” adding that the treasury company label has become confusing.
Bailey’s counter‑frame: the bitcoin treasury company in a fiat system is a bank – or, if the term spooks people, a Bitcoin financial institution. In his view, the model is straightforward: build and monetize the balance sheet. Operators that execute well should grow assets over time; those that don’t will trade at a discount and be consolidated by better managers. He closed with a provocation: if you short the category of Bitcoin banks, you’re effectively shorting Bitcoin’s role as a monetary primitive.
The entire treasury sector is being tested… Toxic financing, failed altcoins rebranded as DATs… The bitcoin treasury company of the fiat system is a bank… If you’re short Bitcoin banks… you’re really shorting Bitcoin’s role.– David Bailey
Reaction on X was mixed. Critics questioned whether BTC treasuries deserve anything but par or a discount to their BTC per‑share value until they demonstrate real, recurring yield rather than dilution via equity issuance. One reply argued current BTC treasuries are “asset accumulation entities” – fine as holding vehicles, but not yet a basis for a valuation premium without proof the BTC stash can be monetized at scale. Another commenter said the “simplest trade” is to buy BTC and short bitcoin treasury stocks.
Others backed Bailey’s framing. Richard Byworth (Syz Capital) agreed and cautioned that BTC treasuries should be selective about whose money they accept; he also quipped that “DATs should be renamed STDs” to flag low‑quality alt‑treasury deals. Supportive replies cast the Bitcoin bank idea as the next iteration of crypto capital markets; detractors warned it remains an unproven business model.
The debate highlighted two operating models for corporate BTC treasuries. One treats them as passive wrappers around BTC holdings; the other positions them as balance‑sheet businesses – lenders, market‑makers or service providers – aiming to generate spread income and fees on top of BTC. Bailey’s post highlighted this split.
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