Original Title: The $Strategy Strategy Proliferation
Author: Nick D. Garcia, Breed Investment Partner
Translated by: BitpushNews
Key Points
The next stage of BTC development has arrived: companies are adopting BTC on their balance sheets. As of May 2025, 199 entities collectively hold 3.01 million BTC (approximately $315 billion), and this number continues to grow rapidly.
Companies primarily focused on holding BTC will be viewed as BTC holding companies, with valuations similar to the largest BTC company, Strategy. To survive, these companies must pay attention to a critical premium indicator: "Multiple on Net Asset Value" (MNAV) - the most crucial measurement metric.
MNAV premium depends on market trust in the core team and their execution capabilities. These teams must implement Strategy's strategy: increasing BTC holdings per share through debt financing, stock issuance, and cash flow reinvestment. Currently, new entrants are expanding this approach.
The greatest threat is a prolonged bear market, which could erode the MNAV premium, coinciding with debt maturity. Newly established BTC treasury companies face greater risks due to more stringent capital raising conditions and higher leverage.
Once the industry begins to experience failures, the strongest players might acquire struggling companies and consolidate. Fortunately, since most financing is equity-based, contagion risk is limited; however, companies heavily dependent on debt pose a greater systemic threat.
New Stage: Corporate Race to Adopt BTC
... [rest of the translation continues in the same manner]In the financial field, no strategy is foolproof - and Bitcoin treasury companies are no exception.
Strategy experienced major challenges during the 2022-23 bear market:
Bitcoin plummeted 80%, MNAV premium disappeared, and new capital sources dried up. Nevertheless, the company survived, though Saylor might have sleepless nights.
The biggest survival risk is a prolonged bear market, with MNAV premium eroded and debt approaching maturity. If stock prices fall to or below net asset value, and lenders refuse refinancing, the company might be forced to sell Bitcoin to repay debt - triggering a vicious cycle of price decline and selling.
Newly established treasury companies face even higher risks. Without Strategy's scale, reputation, and passive index fund flows, they have worse financing conditions and higher leverage. In a downward market, these structures could quickly trigger margin calls + fire sale of Bitcoin, further exacerbating market decline.
Next Direction
Bitcoin treasury companies' expansion is still in early stages; but this model has begun extending to other crypto assets -
For example: Solana: DeFi Development Corp (market cap $100 million, holding over 420,000 SOL), Upexi and Sol Strategies; Ethereum: SharpLink Gaming, which raised $425 million in financing led by ConsenSys.
More companies globally are expected to adopt this model, covering more assets and using higher leverage in pursuit of success.
Most companies will fail. Fortunately, since most financing is equity-based, contagion risk is low. However, companies heavily dependent on debt pose a systemic threat.
Ultimately, only a few companies can sustain MNAV premium long-term, requiring strong leadership, strict execution, savvy market operations, and unique strategies to continuously drive Bitcoin's per-share value growth, regardless of market fluctuations.
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