Equity research and brokerage firm Bernstein revealed that Ethereum treasuries are generating more on the digital asset than their Bitcoin-focused counterparts. According to the report, the treasuries are generating staking rewards in addition to holding the virtual asset as a reserve asset.
On Monday, the analyst wrote in a note that Ethereum treasuries are facing challenges such as liquidity constraints and smart contract risks that differ from Bitcoin treasury models. The company argued that Ethereum’s proof-of-stake mechanism allows the firms to stake assets for yield, but Bitcoin’s proof-of-work structure allows entities to hold BTC without staking.
Ethereum Treasuries emerge as next evolution of Strategy’s playbook
Bernstein noted that Ethereum treasuries are also attempting to address limitations on how they deploy capital. According to the report, the treasuries’ staking contracts are liquid, but often wait for days in the queue to unstake.
The analyst argued that ETH treasuries need to balance Ethereum liquidity and yield optimization as they stake the digital asset for yield. The brokerage firm added that yield optimization techniques such as the Eigenlayer staking model and…
