Nakamoto, SharpLink, Strive Seen Outperforming Bitcoin ETFs
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Fazen Markets Research
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On April 9, 2026 TD Cowen analyst Lance Vitanza published research identifying three digital-asset treasury companies — Nakamoto, SharpLink and Strive — as potential outperformers relative to conventional spot Bitcoin ETFs. The thesis centers on these firms’ ability to "stack" digital assets on their balance sheets and capture staking or validator yields that spot ETFs do not offer, a structural difference Vitanza argues can generate several percentage points of incremental return. The call comes roughly 27 months after the initial U.S. rollout of spot Bitcoin ETFs in January 2024, which converted bitcoin exposure from a pure price play into an institutional wrapper that nevertheless remains yield-free. Coindesk reported the TD Cowen note on Apr 9, 2026 and highlighted the contrast between corporate treasuries that actively generate yield and passive ETF structures that track spot price. Investors should treat this as a sector-level observation about business models rather than an endorsement of specific securities.
TD Cowen’s note must be read in the context of the broader market evolution since January 2024, when multiple U.S. spot Bitcoin ETFs began trading following SEC approvals and significant institutional demand. The arrival of spot ETFs shifted bitcoin from being largely accessible only through exchanges and OTC desks to an exchange-traded product that fits within traditional institutional mandates. However, spot ETFs typically do not generate cash yield; they offer price exposure only. By contrast, corporate entities that hold diversified holdings of proof-of-stake and protocol-native assets can, in theory, earn operational yields through staking, validating, lending, or custody income, which is the foundation of Vitanza’s recommendation (Coindesk, Apr 9, 2026).
The companies flagged by TD Cowen exemplify different parts of the ‘‘digital-asset treasury’’ spectrum. Nakamoto (company referenced in the TD Cowen note) has emphasized operational yields and diversified token holdings in its public statements, while SharpLink and Strive have marketed staking and validator operations as part of their return profile. These are business-model distinctions: ETFs aggregate spot exposure and benefit from scale and liquidity, while treasury companies accept operating complexity and potential volatility in exchange for prospective yield. The difference in income generation is central to comparing risk-adjusted returns across instruments.
Historically, equity-like vehicles that bundle operational yield with balance sheet exposure have sometimes outperformed pure price trackers during periods of stable or rising underlying asset prices. For example, between 2016-2020 in other digital-asset segments and in certain commodity equities, active yield capture combined with asset appreciation produced outperformance versus passive benchmarks. That precedent is the empirical backdrop TD Cowen points to when arguing these three names can "beat" Bitcoin ETFs on a total-return basis under certain scenarios (TD Cowen research note; reported by Coindesk, Apr 9, 2026).
TD Cowen’s note is precise about numbers in two respects: the count of companies covered (3) and the research publication date (Apr 9, 2026). That is a starting point, but investors need more granular metrics to test the thesis. Key quantitative variables include: staking yield expressed as annual percentage yield (APY), annualized volatility of the firms’ equity versus BTC spot, and the proportion of liquid vs locked assets on each firm’s balance sheet. Industry sources indicate staking yields for major PoS networks typically range from a few percent to low double digits annually; the gap versus spot BTC ETF income (effectively 0% yield) is therefore meaningful if realized (industry staking data; 2026).
Another critical datapoint is the timeline: spot Bitcoin ETFs began trading in January 2024, creating an ETF-driven benchmark that captured the lion’s share of passive capital inflows. As of Q1 2026, aggregate flows into U.S. spot Bitcoin ETFs have been the primary marginal buyer of bitcoin in certain months, compressing volatility at times and concentrating price discovery in the ETF wrapper, but they have not provided yield. TD Cowen’s argument relies on the incremental return from staking and capital-light services being enough to overcome any relative valuation discounts and operational risks.
Finally, compare year-on-year metrics. If a treasury company can produce 4-8% staking yield in 2026 while its equity trades at a free-cash-flow yield materially above that of a passive ETF sponsor, the equity could in principle offer higher total return than an ETF that only tracks price. By contrast, in years where bitcoin outperforms dramatically on price appreciation and where staking incomes are small relative to price moves, ETFs may beat these equities on a pure total-return basis. Investors must therefore evaluate both yield capture and convexity to bitcoin price swings (TD Cowen research; Coindesk, Apr 9, 2026).
If TD Cowen’s view gains traction among institutional allocators, capital flows could re-rate a subset of small-cap crypto equities that demonstrate transparent staking operations and conservative treasury management. That would represent a rotation within the broader crypto ecosystem — from passive ETF exposure back toward active balance-sheet plays. The scale, however, matters: ETFs manage tens of billions in assets globally post-Jan 2024, and a reallocation sufficient to move market prices would require material inflows into these niche equities, not merely tactical allocations.
Comparatively, these digital-asset treasury companies face a different competitive environment than, say, centralized exchanges or miners. They compete on operational execution: custody security, validator uptime, risk management of staking derivatives, and regulatory compliance. Investors will prize metrics such as locked-up asset ratios, validator slashing incidence (percentage of stake lost to slashing events), and third-party audit outcomes. Peer comparison should be done on APY capture, balance-sheet liquidity, and governance risk rather than headline market-cap alone.
From a capital markets perspective, the growth of yield-bearing products and companies could encourage product innovation — e.g., ETFs that incorporate yield strategies, structured products that wrap staking yields, or hybrid funds. Such innovation would change the benchmark dynamics: if ETFs can package yield, the relative advantage of corporate treasuries could shrink. For now, the structural gap — ETFs with spot exposure and treasuries that can capture yield — remains salient (market structure analysis, 2026).
Operational risk is the most immediate hazard for firms staking assets. Validator slashing, misconfiguration, custody failure, or smart-contract exploits can convert expected APY into realized negative returns. Historical episodes in the sector show that single incidents can materially impair a treasury company’s balance sheet and investor confidence. Regulatory risk is also elevated: jurisdictions have diverging stances on staking income, custodian obligations, and disclosure requirements. A regulatory adverse ruling could erode the value proposition of yield capture strategies overnight.
Valuation and liquidity risk follow. Many of the companies promoting staking yields trade on smaller exchanges with limited free-float; forced selling or outflows could push equity prices well below intrinsic NAV if markets reprice tail risks. There is also accounting and tax complexity: staking rewards and validator income raise questions on recognition, tax treatment, and matching of expense vs revenue that can materially affect reported earnings. Investors should therefore demand high-quality transparency and audited reporting before treating incremental APY as durable.
Finally, correlation risk: if bitcoin experiences a structural sell-off, the nominal APY from staking may not offset equity de-rating driven by declines in the underlying asset price. In severe bear markets, balance-sheet exposure to volatile tokens can swamp yield benefits, producing underperformance versus an ETF that merely tracks spot (which, while suffering price depreciation, avoids operational loss events attached to corporate activity).
Over a multiyear horizon the trade-off is straightforward: firms that reliably convert staking and operational activity into predictable, audited yield could present a structural premium to price-only ETFs. That said, the margin of outperformance is conditional on operational competence and stable crypto markets. Should staking yields compress or regulatory burdens increase, the advantage could quickly vanish. Investors therefore must evaluate scenarios: high-price appreciation environments where ETF price-tracking wins, moderate appreciation with stable yields where treasury plays may outperform, and severe declines where both suffer but operational losses compound equity downside.
From a market microstructure standpoint, expect increased scrutiny of disclosure and stronger operational standards for companies that market yield. That will be the decisive filter separating firms that can sustainably deliver the TD Cowen thesis from those that merely sell it as marketing. In our view, the most likely path for meaningful re-rating is steady operational performance, avoidance of major loss events, and transparent reporting that allows investors to quantify yield durability.
Fazen Capital views TD Cowen’s argument as a valid structural observation rather than a guaranteed outcome. The contrarian insight is that the largest inefficiency in current crypto markets is not the absence of yield, but the mismatch between headline APYs and the true, risk-adjusted, after-cost returns investors realize after accounting for slashing, custody, and tax. Where TD Cowen sees a straightforward yield pickup, we see a complex arbitrage that requires operational alpha, not just balance-sheet scale. That suggests active due diligence will be more important than thematic allocation: two firms with identical APY claims can differ materially in realized returns due to governance, geographic regulatory exposure, and counterparty selection.
We therefore recommend a dispassionate framework for evaluating such companies: verify audited staking income (look for third-party validation), quantify the liquidity of locked assets, stress-test balance sheets under multi-month price declines, and insist on granular disclosure of slashing and validator downtime. A concentrated allocation to a handful of nominees is sensible only when these layers are satisfied. For institutional investors considering the sector, we advise piloted allocations with stringent oversight rather than broad thematic rotation.
TD Cowen’s Apr 9, 2026 note highlights a plausible route for Nakamoto, SharpLink and Strive to outperform spot Bitcoin ETFs via staking and operational yields, but the realization of that thesis depends on execution, regulatory clarity and market conditions. Investors should treat the idea as a sector-level differentiation problem requiring granular, operational due diligence.
Disclaimer: This article is for informational purposes only and does not constitute investment advice.
Q: How much yield can treasury companies realistically generate relative to a spot Bitcoin ETF?
A: Industry staking yields for major proof-of-stake networks in 2026 generally range in the low single-digits to low double-digits APY, whereas spot Bitcoin ETFs offer no intrinsic yield. The net advantage depends on realized slashing, fees, custodial costs and tax treatment; investors should demand audited evidence of realized yields before assuming a full APY pickup.
Q: What historical precedent supports TD Cowen’s thesis?
A: Precedents exist in other asset classes where balance-sheet active owners (e.g., royalty companies, commodity storage operators) outperformed passive price trackers when they could capture stable operational income. However, those precedents required repeatable, auditable operations and strong governance — conditions not uniformly present across crypto treasuries.
Q: Are there regulatory triggers that could reverse this thesis quickly?
A: Yes. Regulatory changes that restrict staking, recharacterize staking rewards for tax, or impose stricter custody requirements could materially reduce or eliminate the yield advantage. Institutional investors should monitor regulatory developments closely and stress-test scenarios accordingly.
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