With weekly interest-paying preferred shares extending its lifespan, is the DAT era coming to an end?

On June 3rd, Odaily Odaily that Bitmine, Tom Lee's Ethereum treasury company, announced plans to publicly offer 9.50% perpetual preferred stock, raising $300 million, with dividends paid weekly in cash. This comes after Strategy sold 32 Bitcoins for approximately $2.5 million in late May—its first sale in four years—to pay preferred stock dividends. However, the news triggered a market crash: Bitcoin fell below $65,000, dropping more than 14% in two trading days. Two things point to a common predicament for DAT companies: After mNAV (market capitalization/net worth of tokens, i.e., how much the market is willing to pay for every dollar of the company's tokens) fell below 1, the channel for equity issuance and financing effectively closed. Dividends and debt are rigid expenditures, forcing the company to sell tokens to repay them, which in turn exacerbates selling pressure—creating a downward spiral. Currently, Strategy and Bitmine have mNAVs of 0.82 and 0.80, respectively. SoSoValue researchers believe that the current Bitcoin cycle's funding was driven by two engines: first, DAT companies borrowing money to buy cryptocurrencies, and then continuous net inflows into spot ETFs. Now, both engines have stalled—SoSoValue's ETF and Crypto-Stock dashboards show that BTC spot ETFs have experienced net outflows for 12 consecutive days, with a cumulative net outflow of nearly $4 billion; ETH spot ETFs have experienced net outflows for 16 consecutive days, with a cumulative net outflow of approximately $800 million; and the DAT camp, led by Strategy and Bitmine, has collectively fallen below mNAV. With both major sources of incremental funds drying up simultaneously, whether the DAT companies' crisis represents the bottom of this crypto cycle remains to be seen.