Cryptocurrency Bitcoin in Peril as Anticipated 'Death Spiral' and Significant Price Plunge Appears Imminent
Nakamoto, a bitcoin treasury company led by David Bailey, has experienced a 50% share price crash, following a period of market volatility in the crypto sector. Bailey, who served as a bitcoin advisor to former U.S. President Donald Trump, has been vocal about the challenges facing the industry.
The company, which merged with healthcare company Kindly MD in August, bought almost 6,000 bitcoin for around $700 million. However, the bitcoin price has failed to make significant gains in 2025, contributing to Nakamoto's struggling stock price.
Bailey has blamed the flood of crypto treasury companies and the confusion surrounding the treasury company moniker for muddying the narrative. He has warned shareholders of more volatility and encouraged them to exit if they are looking for a trade.
Nakamoto's multiple-to-net asset value (mNAV) has declined to 0.7, compared to an mNAV of 1.2 for Strategy, according to BitcoinTreasuries.net. An mNAV of 1 implies a company market capitalization equal to its underlying bitcoin price, meaning a lower mNAV indicates a company is trading at a discount.
In contrast, Strategy, which began buying bitcoin in 2020, has seen a 30% share price plunge since its July peak, with its mNAV more than halving from a recent high of 3 in November last year. The company was inducted into the Nasdaq 100 last year after buying 638,000 bitcoin worth around $73 billion.
Despite the challenges, Bailey has remained optimistic about the future of bitcoin and crypto. He has dismissed fears of Nakamoto's potential implosion, stating, "The only way out is through." He has also emphasized the importance of building an aligned shareholder base.
The crypto sector has faced scrutiny this year, with Elon Musk, Tesla billionaire, issuing a $37 trillion warning. However, Bitcoin and crypto have still been embraced by Wall Street and the White House. Bailey has criticized the flood of crypto treasury companies and the confusion surrounding the treasury company moniker, stating that it has muddled the narrative.
New treasury companies may face tougher terms and higher leverage ratios, potentially amplifying downside pressure in a market downturn. Despite these challenges, Bailey has encouraged shareholders to remain resilient and to focus on the long-term potential of the crypto sector.
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