A New Wrinkle On The Basis Trade

Markets are always hunting for the next big trade. In 2026, I believe the trade will be a new wrinkle on the traditional basis trades where investors go long Digital Asset Treasury companies (DATs), and short futures. While sophisticated market participants have driven positive returns with the long ETF, short futures strategy for bitcoin and ether, this time, a new variation of the basis trade will include DATs and extend across the broad array of crypto projects that are commonly known as “alts”.

Digital Asset Treasuries (DATs) had their breakout year in 2025. Typically public companies, DATs issue and sell public shares, and use proceeds to buy a dedicated crypto asset. In doing so, they attempt to increase their crypto tokens per share. So, for the typical investor, DATs can be traded, custodied and hedged just like any other stock. This eliminates the operational complexity or regulatory uncertainty for traditional investors who are uncomfortable managing native crypto assets. For this reason, DATs are emerging as a bridge between crypto markets and traditional finance.

What makes DATs especially powerful is their flexibility. These companies can deploy a wide array of treasury and yield strategies with an aim to increase their multiple to net asset value, or “mNAV”. By maximizing token ownership on a per share basis, DATs seek to outperform their underlying token. One successful example is Michael Saylor’s Strategy, which saw its stock price surge 22x since it began buying bitcoin in TKYEAR through September of 2025, while the digital asset it accumulates, bitcoin, appreciated nearly 10x over the same period.

But, volatility works in both directions. Recent market moves have seen some DATs retrench and mNAVs have fallen. Even with the operational ease and regulatory clarity offered by the structure, many DATs remain out of reach for many investors because of their volatility. To date, hedging options have been limited due to restrictions on Commodity Futures Trading Commission (CFTC)–regulated futures for the preponderance of tokens.

The missing link: CFTC-regulated futures

In traditional markets, futures are contracts that let investors lock in the future price of an asset. For centuries, futures have played an important role in risk management, giving institutions a way to hedge exposure, speculate on price movements, and scale efficiently. In crypto, however, regulated futures exist only for only a small subset of tokens, like bitcoin and ether.

The absence of comprehensive crypto futures can be largely blamed on former SEC Chairman Gary Gensler. During his tenure, Chair Gensler asserted that most crypto assets were securities. Futures are derivatives on commodities which would have placed them outside of his jurisdiction and control. So, Gensler suppressed their launch, depriving investors of important risk management tools.

The world has changed. As the U.S. President Donald Trump’s administration aggressively pursues its agenda to make the U.S. the “crypto capital of the planet,” new SEC Chairman Paul Atkins has made it abundantly clear through numerous public statements that “most crypto tokens are not securities.”

With this regulatory hurdle cleared, futures are now in the spotlight. These futures aren’t just standalone products — they’re a gateway to broader market access. Through its generic listing standards guidance, the SEC recently clarified that tokens with six months of futures trading can more easily be listed as ETFs, opening the door to institutional capital and mainstream adoption. And as crypto futures become liquid, the long DAT, short futures strategy becomes possible.

The DAT Basis Trade

A basis trade is when an investor buys an asset in the spot market and simultaneously sells a futures contract on the same asset, aiming to profit from the price difference — or “basis” — between the two. “Contango” is when future prices are higher than spot. Under this market condition, basis trade strategies tend to be profitable.

DATs hold, stake and even restake digital assets, earning real onchain yield. By buying their stock, investors gain exposure to that cryptocurrency and its yield. By shorting the corresponding futures of the DATs’ crypto holdings, investors hedge away price swings in those assets. What’s left is the spread between the future price of the token, versus the spot holdings of the DAT. When a DAT trades below its net asset value or when the future price of the token (or “total return” token, which is a future that includes staking yield) is higher than the DATs’ spot crypto holdings, investors pocket a steady, relatively market-neutral return. While it’s hard to project the size of basis, for alts, the differences may be more pronounced than other assets–driving a higher yield to the investor.

The upside is clear. When mNAVs are rising and futures are in contango the DAT basis trade could drive compelling returns. But, like all strategies, there are many risks and downside scenarios. Perhaps the most evident is a scenario where the mNAV precipitously decreases, and losses on the stock leg are not fully offset by the futures hedge. Also, DATs that trade at a discount to NAV may become obvious takeover targets. While this could erase losses by restoring mNAV, the acquirers could pivot to another asset class necessitating an unwind of the trade.

For those sensitive to these risks, ETFs, where the mNAVs are designed to hold steady at par, may be preferred over DATs when it comes to executing a regulated basis trade. But comprehensive alt ETFs, along with futures in the underlying asset, are just starting to come online. So, in the interim, the bridge offered by DATs, plays an important role in educating traditional investors on the possibilities as crypto investing normalizes.

As regulated futures proliferate across alts, the long DAT, short futures trade could become an ideal way for Wall Street to capture crypto yield without touching a wallet or suffering from the intense volatility that defines crypto as an asset class. In 2026, I think it will be the trade of the year.

Source: https://www.coindesk.com/opinion/2025/11/05/long-dats-short-futures-a-new-wrinkle-on-the-basis-trade