According to research released by 10X Research on Friday, retail investors have suffered nearly $17 billion in losses after chasing Bitcoin exposure through crypto treasury firms like Metaplanet and Michael Saylor’s Strategy. The report, titled “After the Magic: How Bitcoin Treasury Firms Must Evolve Beyond NAV Illusions,” revealed that investors overpaid by an additional $20 billion for this exposure, as companies sold shares at massive premiums far above the net asset value (NAV) of their Bitcoin holdings.
When market conditions reversed, share values collapsed, leaving small investors holding the bag. For example, Metaplanet’s market capitalization surged to $8 billion from a $1 billion Bitcoin base but crashed to $3.1 billion during a correction, even though it held around $3.3 billion worth of Bitcoin. Similarly, Strategy’s shares, which once traded at three to seven times the firm’s actual Bitcoin holdings, now sit at roughly 1.4 times NAV, erasing much of the speculative premium.
Analysts described the business model as “financial alchemy,” where firms repeatedly sold stock at inflated valuations, used the proceeds to buy more Bitcoin, and perpetuated the cycle until it broke down. They warned that these companies can no longer rely on “inflated NAVs” and must evolve into arbitrage-driven asset managers to potentially generate 15–20% annual returns.
This report emerged amid a brutal week for the crypto market, with over $600 billion in total market value evaporating in seven days. Bitcoin plunged 4% to $103,550, its lowest level since June, while Ether slipped below $3,700, down about 25% from its August peak. The Binance-linked token BNB crashed as much as 11% due to technical glitches on the exchange, which promised $600 million in compensation. Investors also pulled $593 million from US-listed Bitcoin and Ether ETFs, and the put-to-call ratio for Bitcoin on Deribit spiked to 1.33, indicating heightened bearish sentiment.
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