- Nakamoto Holdings secures substantial funding to acquire Bitcoin.
- Company stock experiences a significant decline, plummeting over 96% from its peak in May.
- An analyst observes that the cryptocurrency treasury concept has been fundamentally undermined.
A prominent Bitcoin treasury strategy faces major setbacks.
Nakamoto Holdings, after its merger with KindlyMD, a healthcare business, in August, encountered a sharp drop, exceeding 50% on Monday. This occurred shortly after the expiration of the lock-up period for its PIPE (Private Investment in Public Equity) shares last week, allowing insiders to sell their holdings.
Nakamoto’s stock has diminished considerably, witnessing a 96% decline from its high point in May, with current trading at $1.50.
This decline represents a substantial setback for the burgeoning Bitcoin treasury trend, involving over 170 businesses.
“The crypto treasury idea has been decimated,” remarked Scott Melker, a well-known cryptocurrency trader, in his Tuesday newsletter.
wrote
Melker elaborated, stating that “KindlyMD didn’t simply crash; it met a fiery end that would rival a grand July 4th display in NYC.”
This situation signifies the most drastic downturn within the corporate Bitcoin sector to date, highlighting a problematic scenario for Bitcoin treasuries.
Presently, a significant proportion of firms engaged in this field operate below the value of their Bitcoin holdings. Some resorts to unconventional methods to
trade below the value and even
avoid delisting from major stock exchanges.
PIPE Share Unlocking
The major blow came from the release of previously restricted PIPE shares.
A PIPE arrangement grants certain investors the opportunity to acquire shares at a predetermined cost before they are available for public trading.
In Nakamoto’s case, insiders secured shares at $1.12, observing the subsequent surge to approximately $34 in May, which then led to selling their stock.
The unlocking of PIPE shares prompted a turbulent period.
David Bailey, a leading figure at Nakamoto, attempted to allay concerns, as he previously aided Donald Trump’s acceptance of cryptocurrency during his campaign.
In a
late-night message
to shareholders, Bailey characterized the volatility as “not out of the ordinary,” even amidst the stock’s substantial decline.
Bailey positioned the decline as part of “building a foundation of committed shareholders.”
He encouraged “shareholders seeking quick gains” to exit their positions.
Holdings of 5,765 Bitcoin
The timing emphasizes the absurdity of the market hype.
KindlyMD revealed the Nakamoto merger on May 12, with its completion occurring in mid-August. Furthermore, the company’s initial Bitcoin purchase didn’t take place until late August.
Nakamoto’s value rose dramatically – increasing as much as 2,700% – largely influenced by speculation rather than factual Bitcoin reserves.
Nevertheless, KindlyMD acquired 5,765 Bitcoin, valued at around $665 million, securing its status as the 16th largest corporate Bitcoin holder,
according to
BitcoinTreasuries.
They represent a growing trend among businesses adding Bitcoin to their financial statements.
Currently, corporations collectively hold over 1 million Bitcoin.
Self-Promotion
In June, Bailey discussed the treasury investment spree on a podcast.
“Our least successful investment has grown three-fold, while our most successful has increased over 200-fold,” he
said
on a June 13 podcast with crypto personalities.
When asked if he’d make a billion dollars, Bailey responded: “We’re going to make a lot more than that.”
He presented intentions to introduce treasury ventures in “every capital market globally,” naming countries as if from a directory: Saudi Arabia, UAE, Turkey, South Africa, Germany, France, UK, Netherlands, Brazil, Thailand, Taiwan, and South Korea.
Now the headline deal has collapsed.
Early Indicators
Analysts
foresaw
the potential issues.
The healthcare-to-Bitcoin model lacked underlying rationale.
For example, KindlyMD
reported
revenue of less than $10 million in Q2 2025.
KindlyMD is one of many.
Metaplanet, a former hotel operator, has also raised billions to buy Bitcoin. Retail videogame shop
GameStop, has joined them.
Short sellers like Jim Chanos, have been
targeting
Bitcoin treasury firms.
“We are seeing SPAC-like 2021 numbers in the Bitcoin treasury market right now,” Chanos said back in July.
Now, Nakamoto’s collapse won’t end the Bitcoin treasury trade, but the lesson is expensive and clear.
Pedro Solimano is
DL News’ Buenos Aires-based markets correspondent. Got at a tip? Email him at
psolimano@dlnews.com
.