Muneeb Ali - Igniting Bitcoin Utility: DATs as the Engine - TOKEN2049 Singapore 2025

Hi everyone, good morning. Um, I'm Munip. I'm the founder of STAX and I've been in the Bitcoin space since around 2013. Uh, today I'm going to walk you guys through uh a very recent trend which is around Bitcoin treasuries. And you might think that you know why why is this interesting?

Why should we you learn about it? I personally think that Bitcoin treasury companies trading on Wall Street is effectively one of the largest evolution points of Bitcoin that we've seen in the last 10 plus years. And in this presentation, I will sort of take a deeper dive, go into some of the concepts, tell you about what these treasury companies are, how they navigate, and what is sort of like my view of how they're going to change the landscape for Bitcoin and a lot of other digital assets. A little bit about STAX. Uh STAX is the largest Bitcoin L2.

Uh we started the project in around 2017. Think of it as Bitcoin is very simple and durable. uh you can't program it, you can't sort of like have a onchain Bitcoin economy and SAX is that missing layer. It provides a programmability to Bitcoin, you can deploy it on chain and developers can come and start building applications. And I'll sort of like link why L2s like stacks are actually very critical for this next evolutionary phase of Bitcoin where it it goes up and and meets Wall Street.

All right. So, what's happening? Uh most of you might be familiar with Micro Strategy or a strategy as it's called now. Uh which is the first Bitcoin treasury company. Michael Sailor pioneered the concept and the concept is actually very simple.

Uh what they're doing is that a publicly traded company is buying Bitcoin and keeping Bitcoin on their balance sheet. Uh what does that do? Basically, there are certain pools of capital that are around the world that don't have access to directly buying Bitcoin. Even with ETFs, you would think that, you know, now Black Rockck has a ETF and there are all these products. Even with these ETFs, there are certain pools of capital that don't have an efficient way of actually uh getting exposure to Bitcoin.

they might have certain uh fiduciary duties or certain sort of like board requirements and these are late stage large pools of capital that have very very different risk profiles. So the genius of Michael Sailor was that he gave them a uh investment vehicle which is just a public company stock that they are familiar with that gives them that gives them the exposure to the underlying Bitcoin. And to put things in perspective, Micro Strategy went from something like a $500 million company to almost like a hundred billion company over the past four or five years. So it's been extremely successful. Uh Micro Strategy has been the best performing stock even more than Tesla uh for for some of the previous years as well.

So what these public companies do is that the bitcoin that is actually uh managed by the company is sort of like it can't be optimized. It's at the discretion of the company what they do with their bitcoin and what sort of investment vehicles they're using. Sometimes they would use uh they would um use convertible debt to raise more capital or they would issue preferred stock to be able to go and raise more capital and then just go and buy buy more bitcoin. So at a high level what's happening is that the best store of value that humans ever created like the hardest money Bitcoin met the most efficient capital market which is NASDAQ and NIC uh and and interesting things starts happening here because before before this Bitcoin was sort of like sitting in this uh relatively disconnected market from mainstream right yes the crypto markets might be very large but they're still relatively disconnected from from from from from the NASDAQ and New York's stocks exchange. These are the most efficient markets ever created in the history of humanity.

So that's where things start becoming interesting. So that's not the first or the last company that's there to hold Bitcoin. Uh Sailor sort of like pioneered the concept and then other people started catching on to that as well. There are many other companies like uh MetaPlanet there uh is is Nakamuro uh Pomp Anthony Pompiano Iano he just announced a company as well. So it started like an entire wave of these new companies that are coming out they're raising capital and they're trying to buy Bitcoin and other other digital assets.

The way this sort of works is that the market is willing to give some sort of a premium to the companies or the management's ability to go and raise more capital. Right? So, micro strategy it trades at around 1.6 premium. Uh basically means that people have confidence in Michael Sailor's ability to be able to go and buy more Bitcoin.

And the metric that they're trying to optimize for is Bitcoin per share. So if you hold Micro Strategy stock and you want to sort of see like how well is this stock performing, the metric that you would look at is is my holding of Bitcoin underlying my stock is actually going up over time or not, right? And then people started applying the same concept to other assets very quickly to Ethereum which naturally makes sense. It's the second largest asset out there and then recently to other crypto projects like Solana and others as well. uh I don't know if you guys have been following the rise of uh Tom Lee's uh BNMR but that has actually bought up something like 10 billion dollars in ETH over the last four or five months right so this concept is actually extremely relevant it's happening right in front of our eyes where these digital assets are now meeting NASDAQ and the public markets are getting exposure to these these underlying things so why me as a Bitcoiner interested in in this market?

Why am I why am I studying this? Why am I looking into what are the dynamics that are emerging here? Let me let me give you a little bit of a backstory. So, basically in Bitcoin, there have always been these two schools of thoughts. One is the original sort of like Satoshi era where people believe that Bitcoin is going to be productive.

Uh there's going to be a circular Bitcoin economy. people are actually going to use Bitcoin and there are going to develop a lot of applications and use cases around Bitcoin and then there is the more era that became later which is more about just holding Bitcoin that I'm just going to hold Bitcoin and it is a passive store of value for me. I think there's value in the passive store of value but frankly I I came into Bitcoin for the first use case. What excites me is actually using Bitcoin, building around Bitcoin, deploying it on chain, having a circular e economy of Bitcoin uh that that actually goes to billions of people around the world uh and and changes the way that that you know financial systems world around the world and I've sort of like watched this trend where if you look at Ethereum, if you look at Salana, if you go to ETH Denver or if you go to Salana Breakpoint over there, you'll see this energy of developers are actually coming in and they're building stuffs with with Ethereum. They're coming in and they're building things with Solana, right?

They're they're deploying these applications and they're this this massive almost like a wave of developers and it's it's very enthusiastic. It's very future forward that they are coming in, they're experimenting and they're doing all these amazing things uh with this chain. Bitcoin is a little bit different. Yes, it's more simple. It's harder to program.

But there are these L2s like STAX, um, Babylon, Lightning, and a bunch of others that do provide some level of programmability to Bitcoin. But that community has relatively been somewhat smaller compared to the other blockchains. But what's happening now is that because of these public markets, now there is public pressure on these treasury companies to make Bitcoin productive because the market is now demanding these treasury companies to be able to generate yield. I'll give you an example. Recently, Kyle Samani who's one of the early investors in Solana, they launched Forward Technologies and uh Cosmo from Panta Capital and Joe from Summer Capital, they launched a Solana company as well.

And the message that they're giving to the market is that yes, Bitcoin is great. It's a great store of value, but it doesn't have any yield. If you look at Ethereum, Ethereum has around 3% or so yield. Out of that, around4% is real economic value and the rest is inflation. If you look at Solana, Solana has around 1.

8% real economic value. So already higher than Ethereum and the rest is inflation. But these are yielding assets where the public treasury companies if they just hold this asset they can actually earn a yield on a on a on a weekly, monthly, quarterly basis and that changes the game. What that does is that these companies and these assets are viewed differently by Wall Street investors and those people are extremely efficient. Like imagine hedge funds on Wall Street, they would actually optimize any any like small area of optimization that is that is there to u to take a profit, right?

That's now putting a ton of pressure on Bitcoin treasury companies and it's a little bit of a come to Jesus moment for Bitcoin holders, right? Like before you could be a Bitcoin holder and sort of like ignore whatever is happening in the rest of crypto. But if you are a Bitcoin treasury company holding around 500 million or a billion dollars of Bitcoin assets and the market is now trading you at below NAV. So NAV is your net asset value and the market is actually trading you at below NAV. That means that you almost become an acquisition target.

A Kyle Sanani can come in and acquire a Bitcoin company, dump the underlying assets for Solana. That's very real competition that's actually now emerging in the public markets where where these people would now have to figure out how to get yield on Bitcoin, what these L2s are, how does onchain Bitcoin economy work. And we seeing a ton of that interest come to STAX. What exactly is STAX? STAX is a Bitcoin L2.

It's a unique asset where uh just like you can you can lock Solana in a validator and start earning the yield which is in sold but on stacks you can lock stacks and the yield is actually in BDC. So, it's a Bitcoin yielding asset that that opens up the world to Bitcoin onchain deployment. And a lot of these treasury companies are now coming to STAX because they see that as a way for how how they can they can compete in the market and and sort of be more competitive against other treasury companies that are out there. This actually reminds me a little bit of uh Barbarians at the Gate. uh I don't know how many people have read the book but there was this time in Wall Street and in some ways it was a very exciting time in the late 80s and early 90s when a lot of these uh private equity uh firms figured out how to go in and do buyouts of large companies and it was a very sort of like brutal and ruthless time as well but it led to a lot of market efficiency and I think that because of Bitcoin Treasury companies our industry is about to enter a similar First stage, it's going to be barbarians at the gate again that if you if you don't know how to manage your balance sheet with BDC on it, there will be a Kyle Sanmani or a Tom Lee standing outside uh willing to take over your company and then then basically taking the underlying assets and using them for for their their own own advantage.

And I think in some ways uh I am a believer in open markets. I'm a believer in free markets. I think that type of competition and that type of of pressure coming to Bitcoin is actually a good thing because in the end that is going to accelerate all of the advancements and technical advancements that we were having for a very very long time and it's sort of like a come to Jesus moment where Bitcoin developer community and the Bitcoin L2s will have to sort of like rise to the occasion and be able to provide the kind of services that people are seeing in some of the other networks. So I think it's a it's a Bitcoin meeting Wall Street which is going to have a large impact on how the developer ecosystem and the yielding opportunities and the onchain economy around Bitcoin is actually going to function. So what role do we see our project STAX playing in it?

I mentioned that it is a Bitcoin yielding asset. Over the last couple of years around 4,000 BDC has gone out as yield on chain for people who have been participating in this economy. And now we are seeing a lot of these large treasury companies that are approaching us. They're like, "Okay, we have a ton of Bitcoin on our balance sheet. How can we actually deploy it and try to try try to make it useful?"

And I think not just STAX, but other Bitcoin L2s are going to have this moment where suddenly billions of dollars of new Bitcoin is actually going to start moving and getting deployed on on on some of these systems. So some of the things that I'm I'm personally extremely excited about for STAX is that right now the way you move your Bitcoin from L1 to L2, there's still some level of trust. There's a decentralized group of signers that's in the middle and but there's very exciting R&D happening where we can make this fully self-custodial. So fully self-custodial Bitcoin on L2 basically means that just like you can have Bitcoin in your coal storage, you can have Bitcoin in your coal storage on the L2 and there's no trust assumption in the middle. We got around $600 million of BTC deployed on the existing system and we think that this number would be in billions of dollars as we get the self-custodial uh Bitcoin out and as more of these digital asset treasuries actually come in and become mega customers for some of the work that we are doing.

Uh with that, if you want to learn more uh about STAX, you can go to stacks.co. Uh if you want to learn more about Bitcoin Treasury companies and what I think is about to happen in the market, you can follow me on Twitter, money. Thank you so much.