🥛 The magic treasury formula 🧪

GM. This is Milk Road, the crypto newsletter that checks itself so you don’t wreck yourself.

Here’s what we got for you today:

✍️ The magic treasury formula
✍️ Banks attack the GENIUS Act
🎙️ The Milk Road Show: Solana's Next Big Catalysts: Treasury Premiums, ETFs & Institutional Demand w/ Brian Rudick
🍪 Powell teased a possible September rate cut

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Prices as of 2:00 PM ET. Click here for our Fear & Greed Index.

THE MAGIC FORMULA FOR CRYPTO TREASURY COMPANIES 💰

Do you ever read your old text messages and get annoyed by your past self?

Sometimes I get a similar feeling when I re-read past articles I’ve written.

For example…

When I previously wrote about analyzing public crypto treasury companies – I said:

The trick isn’t to find a treasury with a crazy low premium and just ape in – it’s to find one that has solid momentum (i.e. growing investor interest) at a fair premium.

You want investors to push the stock up at a faster rate than its crypto holdings – and for that, you need demand.

“Cool dude. How do I gauge this momentum? That’s so vague.” – Present Me, to Past Me.

Lemme make up for my previous sins real quick…

A simple, so-stupidly-easy-my-idiot-cousin-Frank-could-understand-it metric to watch is:

Trading volume.

Volume indicates interest.
Growing volume → indicates growing interest.
Growing interest → indicates growing momentum.

Is it perfect? No. But it’s directionally correct.

So let’s take a look at the top 5 public Ethereum treasury companies by total $ETH held (‘commitments’ to future purchases don’t count), and rank them by volume.

Source: Blockworks

Neat – now let’s piece it together with the other part of the equation: premiums.

(Market cap / value of $ETH held = premium.)

A quick refresher:

The idea (hope) is that the money you invest in treasury companies will increase at a faster rate than Ethereum itself.

So, ideally, you want to buy a treasury company that has enough interest/momentum behind it to increase its $ETH premium over time.

A simple rule of thumb:

Low premium + low investor interest (aka: volume) = dicey
Mid-range premium + high investor interest = better chance of success
Low premium + high investor interest = praise be! God has blessed you on this day

Now, here’re the top 5 public Ethereum treasury companies by total $ETH held, ranked by premium.

Source: StrategicETHreserve

So which companies have the magic formula of low/mid-range premiums + high investor interest?

$SBET and $BMNR.

Boom! Sins: absolved. ✅

P.S. We recently wrote a PRO deep dive breaking down the crypto treasury landscape and how to value them in crazy detail, here.

(Go PRO to unlock the full report!)

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BANKS ARE ATTACKING THE GENIUS ACT 🔪

Peeee-yeeeew, what’s that smell?

The GENIUS Act gave institutions the regulatory green light to build/launch/support stablecoins in the US…

But one thing that it did not allow was for payment-focused stablecoin issuers to offer their users interest on their holdings.

Good news is: there’s a simple loophole that fixes it – e.g. if you own Circle’s $USDC, you can earn 4% annual yield by simply holding it in your Coinbase account.

Bad news is: the banking sector is trying to close that consumer-friendly loophole, even now after the GENIUS Act has been signed into law. 👇

Source: @TheDeFiDefender

So why ruin the fun?

Simple: banks make the bulk of their money by taking in deposits from customers → paying little to no interest → then lending that money out at higher rates.

If customers can earn 3-4% on stablecoins, versus nearly nothing in bank accounts – there’s a solid chance they’ll want to move their money out of the traditional system.

So now – instead of embracing the loophole and competing with these new yield opportunities – they’re trying to pull the ladder up behind them.

(Can I get a “Oh brother, these guys stink!”)

Here’s hoping they fail miserably. ♥️

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BITE-SIZED COOKIES FOR THE ROAD 🍪

This DEX solves an actual UX issue! Milk Road Swap supports both Ethereum and Solana tokens in a single interface.

The whales are buying the dip. From Aug 14-20, wallets of major Bitcoin network players accumulated more than 16,000 $BTC.

It’s no longer a rumor. It’s official: MetaMask just announced its $mUSD stablecoin.

Powell teased a possible September rate cut. He warned of weakening job growth, hinting the Fed might ease up even with inflation still in the picture.

Milk Road’s Bitcoin Price page offers real-time pricing for $BTC, keeping you updated on every move. With a clean layout and reliable data, it’s perfect for those closely tracking Bitcoin’s market activity.