Nakamoto Inc., the publicly traded Bitcoin treasury company founded by David Bailey, has finalized a controversial all-stock acquisition of two other businesses he founded: BTC Inc and UTXO Management. The deal, valued at approximately $81.6 million based on the stock price at closing, has drawn sharp criticism for its structure and the significant dilution imposed on existing shareholders.
The transaction involved Nakamoto issuing roughly 364 million new shares to acquire BTC Inc, which owns Bitcoin Magazine and runs the Bitcoin Conference, and UTXO Management, a Bitcoin-focused hedge fund. This issuance effectively doubles the company's outstanding share count. Based on a 2025 shareholder agreement that set a share value of $1.12, the deal was worth $407 million on paper. However, with Nakamoto's stock trading around $0.248 at the time of the February 19, 2026 closing, the actual transaction value was just over $81 million.
The announcement triggered a further decline in Nakamoto's stock price, which had already collapsed 96% in the previous year. Following the deal's announcement, shares fell from $0.29 to $0.24. The acquisition has been labeled a "Theater of the Absurd" by renowned short seller Jim Chanos, who has been a vocal skeptic of the Bitcoin treasury trade.
Financial details of the acquired companies were also a point of contention. Initially, CEO David Bailey stated on a Bitcoin Magazine X space that BTC Inc and UTXO had done "over $100 million in revenue" in 2025. Nakamoto was forced to file an 8-K form with the SEC to correct this, revealing the actual combined revenue was approximately $78 million. The filing also noted the businesses contributed about $80.5 million in revenue, $34.2 million in EBITDA, and $40.1 million in net income for the 12 months ended September 30, 2025.
Management, including Bailey, has framed the merger as a strategic shift for Nakamoto, moving it "beyond a pure treasury posture toward recurring operating revenues and broader Bitcoin-native services." A Special Committee of independent directors reviewed the related-party transaction, with B. Riley Securities providing a fairness opinion. Despite these governance steps, the deal consolidates media, events, and asset management under one public umbrella, introducing integration and execution risks tied to Bitcoin market volatility.
