In a market increasingly captivated by the allure of bitcoin, a new wave of bitcoin treasury companies is surging, each vying to amass significant crypto holdings. As these companies follow the pioneering playbook of MicroStrategy (MSTR), industry insiders are grappling with the best ways to evaluate and compare these entities. A fresh report from NYDIG’s global research head, Greg Cipolaro, suggests that the key metric lies in the premium these companies trade at relative to their net assets—especially their bitcoin reserves.
Measuring the Bitcoin Premium
The evaluation process Cipolaro proposes involves calculating the companies’ bitcoin and cash reserves, subtracting obligations like debt, and looking at their enterprise value excluding bitcoin-related assets. This premium, essentially a barometer for how much investors are willing to pay for exposure to these companies beyond the value of their bitcoin holdings, is crucial. “It’s this premium that allows these companies to convert stock for bitcoins, effectively acting as a money changer converting shares for bitcoins,” Cipolaro notes.
Yet, the most popular metric, mNAV (market Net Asset Value), which gauges a company’s valuation against its net asset value, may not be enough. An mNAV above 1.0 indicates investor interest in paying more than the bitcoin stash is worth, while a figure below 1.0 suggests the equity is valued less than the bitcoin assets. According to Cipolaro, relying solely on mNAV is “woefully deficient.” He argues for a nuanced approach using additional metrics such as NAV, mNAV measured by market capitalization, and equity premium to NAV.
The Underdogs: Semler Scientific and Trump Media
The detailed analysis reveals intriguing insights, notably about Semler Scientific (SMLR) and Trump Media (DJT). These two companies boast the lowest equity premium to NAV among eight firms examined, sitting at -10% and -16%, respectively. This is despite both having an mNAV above 1.1, suggesting a paradox where the market doesn’t value their stock as highly as their bitcoin holdings might warrant.
Interestingly, neither Semler Scientific nor Trump Media has experienced significant stock movement despite the recent uptick in bitcoin’s price, which hit $108,500 from Friday’s $105,000. Meanwhile, MicroStrategy has seen a nearly 5% increase. This raises questions about the market dynamics affecting these lesser-known firms and whether investor sentiment might shift as bitcoin’s allure grows. As explored in our recent coverage of Metaplanet’s strategy to grow its Bitcoin reserve, similar dynamics are at play as companies seek to enhance their crypto portfolios.
Navigating the Future
As these bitcoin treasury companies continue to evolve, analysts and investors are left pondering the implications of these valuation metrics. Could the low equity premiums signal an opportunity for investors seeking undervalued stocks with robust bitcoin exposure? Or do they reflect deeper uncertainties about the companies’ operational strategies beyond their bitcoin holdings? This follows a pattern of institutional adoption, which we detailed in Metaplanet’s plan to raise $250M for Bitcoin strategy.
While the market remains unpredictable, one thing is clear: the landscape for bitcoin treasury companies is becoming increasingly complex. Investors must navigate a myriad of metrics and market signals, balancing between the allure of crypto-wealth and the realities of corporate valuations. As always, the future remains uncertain—a fertile ground for both opportunity and risk.
Source
This article is based on: Trump Media and Semler Scientific Could Be Cheapest Bitcoin Treasury Companies by This Metric
Further Reading
Deepen your understanding with these related articles:
- Strategy’s $84B Bitcoin Expansion Plan Backed by Wall Street Analysts
- Strategy Raising Another $21B to Buy Bitcoin, Posts Large Q1 Loss on BTC Price Decline
- Metaplanet Issues $25M Bonds to Buy More Bitcoin
Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
