The recent correction in the crypto market has reignited questions about the durability of corporate Bitcoin Treasury Plays, but matrixport researchers say that the biggest of them, strategy, still appears on track for possible S&P 500 integration.
Despite repeated doubts about whether the strategy’s business model can withstand deep drawdowns, analysts argue that a forced, large-scale liquidation of the world’s largest corporate bitcoin (BTC) the holder is not an “imminent danger,” according in a research report on Wednesday by Matrixport.
Instead, the real pressure from the recent correction is on stockholders who bought the stock at an inflated net asset value (NAV), who are currently suffering from the compression effect of the company’s NAV.
While Strategy shares fell from a peak of $ 474 to $ 207, the company could still be poised for inclusion in the S&P 500 index in December, wrote matrixport.
“When overlaid on Bitcoin, shares appear relatively cheap, and the possibility of a December S&P 500 rally is still there.”
However, investors should take this as an important reminder of the importance of “timing and appreciation” when it comes to investments, the report added.
Related: Taiwan Premier has promised the Bitcoin Reserve Assessment Report by the end of 2025
Crypto Market Intelligence Company 10x Research also predicted a 70% chance that Strategy will be Added to the S&P 500 index before the end of the year, Cointelegraph reported on October 29.
The strategy received a “B-” credit rating From S&P Global Ratings, this puts it in speculative, non-investment grade territory often associated with “junk bonds.”
It is marked for the first time a The company dedicated to Bitcoin-Treasury has received an S&P Global Assessment, establishing a new potential benchmark for evaluating crypto treasury companies.
Related: Metaplanet’s Bitcoin gains plunge 39% as October crash squeezes corporate fortunes
Falling MNAV values continue to plague smaller corporate crypto holders
However, concerns persist over the maintenance of smaller digital asset Treasuries (DATS), as some companies have seen their market net asset value (MNAV) fall below key thresholds this year, effectively limiting their ability to raise funds for further bitcoin purchases.
The MNAV ratio compares the value of a company’s business to the value of its crypto holdings. An MNAV above 1 allows a company to raise funds by issuing new shares to accumulate digital assets. Values below 1 make it harder to expand capital and holdings.
Many dats have seen Their MNAVs slip below this key level, including strategy, bitmine, Metaplanet (Mtplf), Sharplink Gaming (SBET), UPEXI (UPXI) and Defi Development Corp (DFDV).
As smaller Treasury companies begin to feel the pressure of the correction, strategy’s executive chairman, Michael Saylor, said He’s not worried about another major Bitcoin crash.
“The company is engineered to take an 80 to 90% drawdown and continue to explore,” says Saylor, during the An interview with Fox Business on Tuesday.
The strategy is to buy 8,178 Bitcoin worth $ 835 million in the latest purchase announced on Monday, which marked a significant increase compared to the average Bitcoin investment of about 400-500 BTC in the previous month.
https://www.youtube.com/watch?v=kwdsrgnhruo
Magazine: Bitcoin to see ‘another big thrust’ to $150k, ETH pressure builds
