Full Text of Xiao Feng's Speech at Bitcoin Asia 2025: ETF is Good! DAT is Better!

Original text organized by: TechFlow

On August 28, Dr. Xiao Feng, Chairman and CEO of HashKey Group , delivered a keynote speech titled "ETF is good! DAT is better!" at Bitcoin Asia 2025. The following is organized from the live transcript, with some minor deletions that do not affect the original meaning.

In recent months, many friends have asked me a question: from on-chain bitcoin trading to off-chain stock exchanges, bitcoin has become a very popular investment tool in stock trading. So, is it more appropriate for such an investment tool to take the form of an ETF, or is it better to use a DAT (Digital Asset Treasury)?

My personal conclusion is that perhaps the DAT model, just like when ETFs first emerged, represents a new revolution in financial instruments.

We know that stocks were initially traded as individual stocks on stock exchanges, then index funds appeared, and after that, index fund ETFs emerged. Every innovation in financial instruments has brought about a significant new asset class. Crypto has moved from on-chain to off-chain, entering the stock market in a way that 99% of people can easily accept, allowing all stock market investors to easily and habitually access crypto assets. So, which way is better? Is the ETF approach better, or is DAT better?

My personal view is: DAT may be the best way for crypto assets to move from on-chain to off-chain. As we can see, so far, the only single commodity or single asset investment tool in the global capital market with the largest ETF is gold. There will never be a single-stock ETF because stocks are already traded on stock exchanges, and you can easily buy them. If you want to buy a basket of stocks, such as an index fund, you need other investment tools. Index funds or ETFs are the most convenient tools for traditional investors. So, before the single-asset ETF, there was only gold, and after the launch of the BTC ETF, we now have the second single-asset ETF. This is a natural and logical process, as everyone is used to using ETFs to create investment tools, making it easier for traditional stock market investors to invest in alternative assets like crypto.

However, when we value ETFs, we use Net Asset Value (NAV); for DAT, we use Market Value. These are two completely different concepts. Market value brings greater price volatility, while NAV volatility is much smaller. Therefore, as a single investment tool for crypto, I believe DAT is a better approach.

Better Liquidity

The biggest advantage of DAT is that it has better liquidity than ETFs, which is the most important and core concern for any investor.

My observation is that the smoothest and best way to exchange between crypto and traditional financial assets is through exchanges. The growth in ETF size comes from subscriptions and redemptions, which require three or even more intermediaries to participate and take 1-2 days to settle. Clearly, this is not as efficient as completing the conversion through trading on a distributed ledger, which may only take 2 or 10 minutes. Therefore, trading may become the main way for traditional finance and crypto assets to convert in the future, so better liquidity is the core advantage DAT has over ETFs.

Better Price Elasticity

At the same time, market value has more appropriate price elasticity than NAV. We know that the reason MicroStrategy can continuously build its financing structure through various financing tools and hold a large amount of bitcoin is largely because BTC itself is highly volatile. Also, the reason why hedge funds and other alternative investors are willing to invest is precisely because they can own a more volatile asset through shares, split equity and bonds off-market, and turn volatility into another tool, both to protect their own prices and to arbitrage. Especially convertible bonds (CB), which are often structured into products by hedge funds or alternative investment institutions off-market. That's why these institutions like to invest in companies like MicroStrategy, buying its stock or convertible bonds, because they can perform structured operations on them. Better price elasticity is something ETFs do not have.

More Appropriate Leverage

Third, it offers more appropriate leverage. Previously, single-asset investment had only two extremes—either holding BTC or ETH spot, or buying futures or CME contracts. There was a huge gap in between, which allowed listed companies to design appropriate leveraged financing structures. You only need to hold the stock, and the company manages the leveraged structure itself, allowing you to enjoy a higher premium than the price increase of the crypto asset itself.

Built-in Downside Protection

Tools like DAT can bring a premium and have built-in downside protection. Imagine if the stock price drops below the net asset value, it is equivalent to giving investors a chance to buy BTC or ETH at a discount. This market price situation will quickly be arbitraged away, so it is in itself a good downside protection. Otherwise, you would rather buy the stock, which is equivalent to buying BTC or ETH at a discount.

Considering all these factors, DAT may be a more suitable financing tool for crypto assets. Just as ETFs were very suitable for index or basket stock investment strategies in the stock market back then, DAT may be the new trend we will see in the next 3 to 5 years.

The scale of assets held by DAT may approach the scale currently covered by stock market ETFs, perhaps in another ten years. Therefore, I believe DAT is the most promising new investment tool for the future, more suitable for crypto assets, while ETFs may be more suitable for stock assets.

Of course, this is just my personal opinion. Thank you all.