Key Takeaways
Ethena’s Man Younger has hailed crypto treasuries as the answer to VC’s provide overhang and a progress driver for income technology tasks. However danger nonetheless stays.
Ethena [ENA] Labs founder, Man Younger, has defended crypto treasuries as one of the best shot at fixing the notorious Enterprise Capital (VC) token unlocks and dumping within the house.
Younger admitted that even ENA had the problem of VC sel-offs due to restricted liquidity within the crypto sector.
However leveraging conventional markets may provide aid from provide overhang, Younger noted.
“You wished an answer to the overhang of VC unlocks? Properly, that is it (crypto treasuries).”
Supply: X
Crypto treasuries: An answer or danger?
VC unlocks occur when early backers exit and offload their holdings onto the retail market to get better their funding.
Sadly, usually, the provision overhang from VCs all the time drags the value decrease, leaving retail with losses.
The sell-off will get even worse in periods of broader adverse market sentiment.
For instance, Celestia [TIA] value plunged over 90% amid Polychain VC’s constant dumping value thousands and thousands from staking rewards and unlocks. Now, a brand new agency needs to purchase off Polychain’s TIA holdings.
The dump on retail turned so notorious that Crypto Twitter (CT) neighborhood dubbed VC-backed tasks as ‘VC tokens,’ shunned them, and pivoted to memecoins, birthing the ‘memecoin supercycle’ development seen from 2024.
Actual income vs “vapourware”
Nonetheless, Younger acknowledged that the majority altcoins are ‘shitcoins’ and ‘vapourware’, and providing them through an ETF (exchange-traded fund) gained’t change something.
In distinction, Younger said that TradFi will gladly again crypto tasks with income like Ethena.
“However I do assume that is an extremely bullish improvement for a small handful of tokens the place TradFi can underwrite an actual enterprise mannequin benefiting from secular progress tendencies.”
In 2025, a number of legacy corporations have embraced crypto treasuries and gone past Bitcoin [BTC] and Ethereum [ETH].
Most have been lured by the windfall from Strategy’s (previously MicroStrategy) profitable BTC wager.
The outcomes? Inventory costs of the corporations have spiked greater than the underlying crypto property. In a approach, it has been a crypto treasury quite than an altcoin season.
However there’s extra to it than simply dislocation in value appreciation.
Bullish… with a warning label
Critics have warned that the extreme debt leverage deployed by the treasury corporations to purchase extra BTC and altcoins may pose a liquidation danger to your entire sector and TradFi in the event that they go bankrupt.
Supply: X
For perspective, Technique has the biggest debt profile of over $8B, whereas Metaplanet solely owes $116 million.
However Galaxy Analysis’s Alex Thorn downplayed the debt considerations as ‘overblown’, stating that the majority will start to mature by 2028.
General, crypto treasuries have supplied the wanted liquidity out there to cap drawdowns. However their debt leverage stays a danger concern.
