Investors are becoming more familiar with Bitcoin Treasury companies as the “euphoria” over bitcoin staking companies is starting to wear off, according to a Bitcoin Treasury executive.
There are currently 205 publicly listed Bitcoins (BTC) Treasury Companies worldwide. But their sheen has begun to dull, with some companies adopting the strategy seeing their net asset value (MNAV) fall in recent months.
“Taking the market is more sophisticated, learning how to assess what’s different in Treasury companies,” kindness of CEO David Bailey, who leads the company’s bitcoin accumulation strategy, said In an interview with CNBC on Thursday.
Bitcoin Treasuries must have the demand and ‘edge’ to launch
Bailey says there’s little reason to launch unless a company is pursuing a truly unique strategy. “It’s like, what’s the edge? Why do you need it?” Bailey said.
“Anytime there’s euphoria in the market, you see good companies come in and you also see bad companies go,” he said.
Bailey said the days are over with new Bitcoin Treasury companies following the exact playbook of public companies already in the market.
“There are a lot of companies that the market can take to the exact same thing,” he said.
He described several ways that these firms can stand out, from pursuing non-international markets to specializing in specific asset categories, such as Michael Saylor’s strategy of breaking into the credit market, or even acquiring and integrating operating businesses that generate stable income.
Bailey’s Bitcoin firm, Nakamoto Holdings, has completed the health care company integration Mabaitmd on August 14, forming a publicly traded Bitcoin Treasury vehicle with plans to raise 1 million BTC.
Shares of KindlyMD have seen sharp swings in recent weeks, falling 55% to $1.22 in a single day on September 15, after Bailey warned short-term traders that the stock was likely to face increased “price volatility.”
“We expect that share price volatility may increase over a period of time,” Bailey said in a shareholder letter.
At the time of publication, Kindness’ stock price is trading at $0.76, according in google finance.
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He said the market will see Bitcoin’s strongest Treasury companies enter the “next phase” in the near future, which will position the industry in a “healthy space.”
The Public Bitcoin Treasury holds a total of $113.8 billion at the time of publication, according in Bitcointreasures.net.
However, many Bitcoin Treasuries have seen their MNAVs crater in recent months.
On September 15, Standard Chartered warned that the many digital collapses Asset Treasury’s MNAV now exposes smaller companies to more risks.
“We see market saturation as the main driver of the recent MNAV compression,” Standard Chartered said.
VC firm Breed says only a handful of Bitcoin Treasury companies will stand the test of time and avoid the vicious “death spiral” that will affect companies holding BTC close to MNAV.
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Glassnode lead analyst James Check said on July 4 That his “instinct is that Bitcoin’s Treasury strategy has a shorter lifespan than expected.”
“For many new entrants, it could be over,” Check added.
Meanwhile, tons of strategy CEO Veronika Kapustina said that while all indicators suggest this is a bubble, it presents “a new segment of finance.”
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