Why more corporates are allocating ethereum to their balance sheets

Yahoo

5 days ago

An increasing number of corporations are allocating ethereum to their balance sheets, not simply as a speculative play, but as part of a broader shift toward treating ETH as a long-term, yield-generating treasury asset.
From Nasdaq-listed SharpLink Gaming, which now holds over 200,000 ETH and earns rewards through staking, to crypto-native players like Status Network, ethereum is emerging as a programmable, productive reserve – an alternative to traditional FX reserves or even gold.
'Ethereum is no longer just seen as a speculative bet on magic internet money: it's becoming the internet bond,' said Cyprien Grau, project lead at Status Network. 'A programmable asset with high collateral value and built-in real yield.'
This shift signals a fundamental rethinking of corporate treasury management. Where gold and cash have long served as passive stores of value, ethereum's programmable design allows it to play an active financial role. Staked ETH not only secures the network but also generates native yield and can be deployed across decentralised finance (DeFi) protocols.
'Ethereum pays you yield with relatively low risk, and you can reuse it: posting it as collateral to borrow on it or pairing it with other assets to provide liquidity and earn swap fees, all in a non-custodial way, without ever taking it off your balance sheet. That's something USD and gold can't do,' Grau said.
Ethereum as a corporate finance asset
Matt Leisinger, co-founder and chief product officer at Alluvial, described the trend as a rapid institutional pivot, driven by the maturation of ethereum's infrastructure and its natural fit within the evolving landscape of onchain finance.
'The surge in ETH held in corporate treasuries, from roughly $600m in April to over $3.5bn today, reflects a major institutional shift,' he said. 'Ethereum is increasingly seen not just as a speculative asset, but as a foundational commodity in onchain finance.'
That rise, Leisinger noted, isn't coincidental. It's been enabled by the growing availability of enterprise-grade tools and custody solutions, allowing corporates to treat ETH not just as an investment but as a productive onchain instrument.
'This growth isn't accidental; it's the result of ethereum's maturing infrastructure and its alignment with how modern digital finance operates.'
He added that multiple forces are converging at once. For one, ETH staking now offers a native, low-risk yield, a kind of onchain fixed income product, that treasuries can access through qualified custodians.
'At the same time, we're seeing significant demand from institutions that want ETH exposure but are awaiting the greenlight on ETH-staking ETFs (exchange-traded funds),' Leisinger explained. 'In that void, direct ETH holdings in treasuries have become the vehicle of choice, regulated, auditable and productive.'
Ethereum as a cash management tool
Treasury teams are increasingly adopting ethereum not just to hedge against inflation or currency devaluation, but as a cash management strategy.
'At Status, staking is a cash management strategy,' Grau explained. 'We are an ethereum-aligned organisation and want to maintain a strong upside exposure to ETH, but primarily we treat it as an enhanced cash position.'
He notes that ethereum's ability to earn in-kind yield, remain liquid, and be reused across DeFi makes it more capital-efficient than stables or fiat. 'We hedge part of it back into stables over time to cover our runway, but leave the rest in ethereum to compound over time and stay aligned with the long-term success of the ecosystem.'
Generating yield with staking and lending
Companies are deploying ethereum using a mix of strategies, staking natively, leveraging liquid staking protocols like Lido and Rocket Pool, or utilising custodial services such as Kraken Pro.
'Most firms run a risk-adjusted hybrid strategy,' Grau said. 'For large ethereum stakers, running validators directly can provide a slightly higher yield... but they are submitted to the operational costs and risks.' These risks include validator downtime, which can leak yield, or slashing penalties if misconfigured.
Liquid staking solutions like Lido are popular for their convenience but come at a cost: 'Both solutions have a 10% fee on yield,' Grau noted. Custodial staking, often used by less crypto-native firms, provides operational simplicity but less control and ownership – 'not your keys, not your coins', as the crypto adage goes.
Beyond staking, firms are deploying ethereum into lending protocols such as Aave and Morpho, sometimes using leverage strategies to maximise returns. However, Grau warns that 'firms need to be more careful on where to deposit as they become exposed to smart contract and counterparty risks, and liquidity mismatches".
Rise of ethereum as a 'programmable reserve asset'
Ethereum's programmability makes it uniquely suited for use cases far beyond passive holding. 'We're seeing ethereum used less as a static asset and more as productive capital,' said Grau. 'Companies and onchain organisations are actively deploying it across DeFi to earn additional yield, deepen liquidity or automate treasury management.'
These strategies include allocating ethereum to decentralised exchange (DEX) liquidity pools to earn swap fees, using it as collateral to borrow stablecoins to fund operations, and even underwriting on-chain insurance markets. Ethereum can also be "restaked" to earn additional rewards by helping secure emerging networks and applications built atop it.
'Ethereum from the treasury will be deployed into native DEX pools, used to pay for rollup infrastructure, and funnelled into a public apps funding pool, showing how ethereum can actively support both operations and ecosystem growth,' Grau explained.
Evaluating ethereum's role in a tokenised future
As ethereum cements its position as the backbone of tokenised assets, stablecoins and fund rails, corporate allocators are beginning to see it less as a speculative cryptocurrency and more as a gateway to the financial infrastructure of the future.
'Ethereum is the backbone of most of the tokenisation work happening today, tokenised treasuries, stablecoins,' said Grau. 'Traditional entities are now going onchain for better operational efficiency.'
Layer-2 networks (L2s) are accelerating this adoption, reducing fees and improving scalability, such as Status Network. 'We foresee more ethereum L2s being launched by institutions that want to leverage ethereum settlement and interoperability with other L2s, tap into the shared liquidity, while being able to impose their own sequencing rules and requirements,' Grau added.
In this evolving ecosystem, ethereum becomes not just an asset, but 'the digital oil needed to participate in the financial infrastructure that's being built onchain".
Compliance, custody and risk management
With increasing institutional participation, robust compliance and custody solutions are becoming essential. Corporations must first decide between custodial and non-custodial asset management.
'In the first case, multi-signature wallets are usually the best,' Grau advised. 'They remove the risk of a single point of failure from a bad actor or scam.' For those opting for custodians, Grau says regulated entities offering advanced security features like multi-party computation or dual approval systems are preferable.
Tracking and reporting staking rewards and DeFi activity is also crucial. 'Tools exist to help with compliance, including rewards tracking, compliance mapping, and DeFi-specific tax reporting.'
Ethereum's evolution into a productive, programmable asset is reshaping how corporations think about reserves, risk and return. As Grau summed it up: 'Ethereum isn't just an asset you hold. It's the financial infrastructure itself.'