What is Byron up to today? Not writing a newsletter!

In his absence today, you’ll hear from Forward Guidance’s Felix Jauvin. He’ll unpack the big takeaways from this week’s DAS London.

P.S. Shameless plug while the boss is away. Byron is just a few followers away from hitting a milestone on X. Give him a follow if you want keep up with his clever commentary and wit.

Another DAS done

As I reflect on the end of another successful Digital Asset Summit from the airport lounge, awaiting a return flight home from London, it’s interesting to think about how far we’ve come since the last DAS in New York.

And yet, it’s just as interesting to see how many themes repeat themselves year after year.

Leverage kills

Nearly every panel’s agenda was thrown upside down in light of the major leverage wipeout last Friday, when $20 billion was liquidated in leveraged positions across crypto.

Upon reflection, the winners and losers of the biggest liquidation in crypto’s history hint at the continued maturation of the industry. 

Some of the biggest losers were funds employing delta neutral strategies of being both long and short through leverage. 

As the crash happened, many with insufficient risk parameters were blown out on their long liquidations (the reason is obvious, price went down) but also their short legs due to the auto-deleveraging function within perpetual futures markets. While some funds were carried about by this cascade, more sophisticated market neutral funds did very well during the weekend. During a panel I moderated on Wednesday called “Generating Alpha in Crypto Markets,” Anatoly Crachilov, CEO and founder of the multistrat crypto fund Nickel Digital Asset Management, mentioned that his fund endured the market stress event quite well and ended the weekend positive. 

I think this reflects the important saturation of the industry where more and more sophisticated pod shops like Nickel will enter the crypto market and the market structure will mature significantly. 

DAT State of the Union

On the first day of DAS, I held a DAT State of the Union that included Ben Forman of ParaFi Capital, Jeff Park of ProCap, Seth Ginns of CoinFund, and Christian Lopez of Cohen & Co. 

As we discussed the evolution of the burgeoning DAT sector, we explore how the space may play out considering the vast majority of these newly launched DATs are now trading at a discount to their net asset value (NAV). 

Seth believes that DATs will follow a power law distribution where two or three DATs will take the lion’s share of the market and dozens of the remaining ones will continue to bleed out and dwindle. 

That scenario does seem likely. But it brings forth the question of what will happen to those DATs that do not make it through the great filter of the power law and survive. 

One idea our panel discussed was the potential for DATs trading at an mNAV above 1.0 to potentially acquire DAT’s at a discount to mNAV. If one is trading at a 30% discount, that would potentially be quite accretive to shareholders.

A potentially more hostile version we discussed: Competing DATs — for example an ETH DAT and a SOL DAT — begin to pick off each other. For example, a 1.0+ mNAV ETH DAT could do a hostile takeover of a SOL DAT trading at a discount, sell the SOL tokens, and use the proceeds to purchase ETH. 

That is a wild potential outcome! Carl Icahn would surely love it. 

The Digital Asset Summits continue to set the standard for institutional crypto conferences. With a third one being added to the mix in the UAE in 2026, it’s only going to get better.

— Felix Jauvin

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