David Bailey: Weak Bitcoin Treasuries Face Rising Investor Skepticism

TLDR

• Investors are becoming more selective about Bitcoin treasuries as market hype declines.
• David Bailey said that only companies with unique strategies will succeed in the evolving Bitcoin treasury space.
• Bitcoin treasuries are seeing mNAV drops as market saturation affects performance and investor confidence.
• KindlyMD’s stock experienced major volatility following its merger with Nakamoto Holdings and Bitcoin accumulation plans.
• Analysts believe the Bitcoin treasury model may have a shorter lifespan than previously expected.

Public interest in Bitcoin treasuries has declined as investors now distinguish between stronger and unsustainable strategies. According to Nakamoto Holdings executive David Bailey, the days of market-wide excitement are over. With falling market net asset values (mNAVs), investors demand clearer, innovative value from treasury companies.

Market Sophistication Rises as Investors Demand Unique Bitcoin Treasuries

Bitcoin treasuries are facing more scrutiny as investor expectations grow sharper and more informed. David Bailey, CEO of KindlyMD, explained that companies must now offer more than mere Bitcoin accumulation. “It’s kind of like, what’s the edge? Why are you needed?” Bailey told CNBC.

He said the market no longer accepts firms copying existing public Bitcoin treasuries without differentiation. Bailey added that launching without a clear, unique plan has become increasingly unviable. “There are so many companies that the market can bear doing the exact same thing,” he said.

Companies must now stand out by targeting underrepresented sectors or geographies or by integrating income-generating operations. Bailey pointed to strategies like entering the credit market or merging with stable businesses. These approaches, he stated, are now vital for long-term survival in the Bitcoin treasuries sector.

Nakamoto Holdings Faces Volatility After Merger

Nakamoto Holdings merged with healthcare firm KindlyMD on August 14 to form a new Bitcoin treasury vehicle. The company plans to acquire 1 million BTC while operating its businesses, which generate recurring revenue. However, recent market responses to KindlyMD show investor caution remains high.

KindlyMD shares dropped 55% in a single day on September 15, closing at $1.22 after Bailey issued a warning about price volatility. “We expect share price volatility may increase for a period of time,” he noted in a letter to shareholders. The stock now trades at $0.76, showing the volatility many Bitcoin treasuries face.

Bailey remains confident that only well-structured Bitcoin treasuries will survive the evolving market conditions. He believes the sector is entering a healthier phase characterized by stronger fundamentals. Nonetheless, volatility and investor skepticism continue to shape outcomes.

Strategic Gaps Threaten Bitcoin Treasury Firms

Standard Chartered warned on September 15 that Bitcoin treasuries face higher risks due to the collapse of mNAV among several firms. The firm attributed the drop in value to market saturation and lack of strategic innovation. Breed VC echoed this view, stating most will fail unless they evolve.

Analyst James Check of Glassnode said, “My instinct is the Bitcoin treasury strategy has a far shorter lifespan than most expect.” He suggested many new entrants might already be obsolete, given current market pressures. The total value held by public Bitcoin treasuries currently stands at $113.8 billion.

TON Strategy CEO Veronika Kapustina added that while signs point to a bubble, it still creates a new financial segment. Bitcoin treasuries that adapt and innovate may be able to withstand the downturn and build sustainable models. Investors now prioritize structure, strategy, and resilience over hype and holdings.

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