Investors are growing increasingly selective about Bitcoin treasuries as market hype wanes, with David Bailey, CEO of KindlyMD, emphasizing that only companies with unique strategies will thrive in this evolving sector. Market net asset values (mNAVs) have been declining due to saturation and lack of innovation, leading to heightened scrutiny. Bailey told CNBC, "It's kind of like, what's the edge? Why are you needed?" He added that the market no longer tolerates firms copying existing Bitcoin treasuries without differentiation, and launching without a clear, distinctive plan is now unviable.
Specific instances highlight the volatility: KindlyMD's stock plummeted 55% to $1.22 on September 15 after Bailey warned of increased share price volatility in a shareholder letter. The stock now trades at $0.76. Nakamoto Holdings merged with KindlyMD on August 14 to form a new Bitcoin treasury vehicle, aiming to acquire 1 million BTC while generating recurring revenue. Meanwhile, Metaplanet, a Japanese Bitcoin treasury, saw its mNAV drop below 1 for the first time, with its stock losing 75% of its value from a high of $13 per share to $3.20, as it halted Bitcoin purchases in late September.
Analysts echo concerns: Standard Chartered warned on September 15 that mNAV collapses could trigger industry consolidation, while Breed VC stated that only a minority of firms will prove resilient. James Check of Glassnode suggested the Bitcoin treasury strategy may have a shorter lifespan than expected, noting, "For many new entrants, it could already be over." Public Bitcoin treasuries currently hold $113.8 billion in total value, but investor focus has shifted to fundamentals like strategy and resilience over mere holdings.
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