Standard Chartered analysts predict institutional capital will increasingly favor Ethereum and Solana over Bitcoin for Digital Asset Treasuries due to staking yields and regulatory clarity, influencing investment decisions.

The Event in Detail

Standard Chartered analysts, led by Geoff Kendrick, project a significant shift in Digital Asset Treasury (DAT) strategies, with a growing preference for Ether (ETH) and Solana (SOL) over Bitcoin (BTC). This reorientation stems from DATs prioritizing factors such as cheap funding, scalability, and staking yields, where ETH and SOL demonstrate competitive advantages. Notably, ETH DATs and spot ETH exchange-traded funds (ETFs) collectively absorbed 4.9% of Ethereum's circulating supply in under three months, indicating aggressive accumulation. In contrast, Bitcoin treasuries are experiencing consolidation rather than new demand, with Bitcoin ETFs registering outflows of $803 million in August 2025, while Ethereum ETFs attracted $4 billion during the same period.

Over 70 companies globally have incorporated ETH into their strategic reserves, collectively holding more than 4.7 million ETH, valued at approximately $2 billion. Among these, about 14 companies have publicly disclosed specific Ethereum treasury strategies, accounting for close to 3 million ETH, valued at approximately $12.86 billion. Key corporate adopters include Dynamix Corporation, which secured 495,362 ETH ($2.16 billion), and Bit Digital, Inc., holding 121,252 ETH with 86.6% actively staked. Similarly, DeFi Development Corp. (DFDV) holds 1.83 million SOL ($371 million), generating a 7.16% annualized yield through staking.

Financial Mechanics

The appeal of Ethereum and Solana in institutional treasuries is largely driven by their yield-generating capabilities. Ethereum's staking yields range between 3% and 5.5% annually, while Solana, as demonstrated by DFDV, can offer annualized yields of 7.16%. These returns significantly outperform U.S. Treasury bonds, which typically yield around 3.5% to 4%. By Q3 2025, approximately 30.2 million ETH, representing 25% of its circulating supply, was actively staked, creating a continuous accumulation cycle funded by staking rewards.

Ethereum ETFs have demonstrated substantial growth, accumulating $30 billion in assets under management (AUM) by 2024 and reaching $27.66 billion by Q3 2025. BlackRock's ETHA fund alone attracted $314.9 million in a single day in August 2025. In contrast, Bitcoin's fixed supply model offers no native yield mechanisms, rendering it less suitable for institutional portfolios seeking income generation. Standard Chartered analyst Geoff Kendrick highlighted that Ethereum treasury companies are currently undervalued compared to firms like MicroStrategy (MSTR) on a net asset value (NAV) multiples basis, especially given ETH's 3% staking yield, which MSTR does not capture. Companies like SharpLink Gaming (SBET) have indicated share repurchases if their NAV multiple falls below 1.0, establishing a valuation floor.

Technological advancements, specifically Ethereum's Dencun and Pectra upgrades in 2025, have reduced Layer 2 transaction fees by up to 99%, enhancing scalability for decentralized finance (DeFi) applications. This has contributed to the Total Value Locked (TVL) in Ethereum-based DeFi protocols reaching $223 billion by July 2025.

Business Strategy and Market Positioning

The increasing institutional allocation to altcoin treasuries signifies a strategic diversification beyond Bitcoin's volatility. While Bitcoin's fixed supply model inspired over 180 public companies to adopt BTC-only strategies, the emergence of DATs in Ethereum, BNB, and Solana reflects a broader desire for yield generation and integration with evolving blockchain ecosystems. Companies like Dynamix Corporation and CEA are actively holding significant amounts of tokens for strategic value, aligning with the infrastructure of the digital economy.

Ethereum's position is evolving as a foundational financial layer for Wall Street, supported by its robust staking economy and extensive Layer 2 networks like Arbitrum, Optimism, and Base, which collectively process 12–14 million transactions daily. This scalability facilitates the tokenization of real-world assets (RWA), with Ethereum already dominating this sector through projects backed by financial institutions like BlackRock, JPMorgan, and Citigroup.

Market Implications

This analysis suggests a re-evaluation of Bitcoin's role within institutional treasuries and a potential acceleration of capital flows into yield-generating assets like ETH and SOL. Short-term, this could lead to increased investment in these altcoins. Long-term, it may redefine the narrative of market dominance among major cryptocurrencies and emphasize the prominence of income-generating assets in corporate balance sheets.

The shift represents a paradigm change in corporate finance, where companies are not only diversifying their reserves but also aligning with the digital economy's infrastructure. The rise of Ethereum DATs is expected to boost on-chain staking, DeFi activity, and broader ecosystem participation, positioning Ethereum as a cornerstone for secure, adaptable, and yield-generating institutional portfolios. The tokenization market, valued at $24 billion, is projected for rapid expansion, further cementing Ethereum's integral role in finance.

Expert Commentary

Geoff Kendrick, Global Head of Digital Assets Research at Standard Chartered, maintains a bullish outlook on Ethereum, stating that ETH and Ethereum treasury companies are "cheap at today's levels." He reiterates a price target of $7,500 for ETH by year-end and $25,000 by 2028. Analysts from FBS emphasize Ethereum's transformation, noting: > "Ethereum is no longer just part of the crypto cycle — it's positioning itself as Wall Street's base layer." This sentiment is underscored by billionaire investor Peter Thiel's reported backing of ETH-focused treasuries, signaling strong institutional confidence.

Broader Context

Macroeconomic conditions, including U.S. Treasury yields near 4%, are compelling corporations to seek alternatives to combat inflation and hedge against fiat devaluation. This environment, coupled with regulatory clarity from developments like the U.S. GAAP fair-value accounting rule (FASB ASU 2023-08) and the CLARITY Act (which reclassified Ethereum as a utility token in 2025), has normalized crypto holdings and facilitated institutional trust.

Ethereum's structural advantages—including regulatory clarity and programmable money—are positioning it as a fundamental asset for institutional investors. The integration of its staking economy into Wall Street's financial infrastructure, coupled with its robust scaling solutions and growing tokenization market, signifies a profound reordering of institutional capital allocation, driven by utility, innovation, and evolving market dynamics.