Bitcoin Treasury Strategy Faces Skepticism Amid Market Saturation

Glassnode lead analyst James Check has expressed concerns about the longevity of the corporate Bitcoin treasury strategy. He believes that the easy gains from this strategy might already be gone for new entrants as the market matures. Check cautioned that many recent firms jumping into Bitcoin reserves could struggle to sustain interest or justify premiums. He stated, “My instinct is the Bitcoin treasury strategy has a far shorter lifespan than most expect,” and added, “For many new entrants, it could already be over.”

Check argued that while early adopters like Michael Saylor’s Strategy, which holds nearly 600,000 BTC, have cemented their lead, new treasury firms face a steeper climb. He noted that investors increasingly expect clear differentiation rather than another firm adding Bitcoin to its balance sheet. Check warned that it will be increasingly difficult for new companies to sustain a premium and get off the ground without a serious niche. He also highlighted that speculative retail investors may flock to these newcomers, but they don’t “have infinite money” to support dozens of copycats chasing the same strategy.

Despite Bitcoin’s recent rally, Check suggested that the growing number of Bitcoin treasury firms risks saturating the market. Data shows at least 21 new entities added BTC holdings in the past month alone. Check noted that larger, well-established firms like Strategy have more time to prove their thesis compared to latecomers. Echoing his concerns, Taproot Wizards co-founder Udi Wizardheimer said many startups entering the Bitcoin treasury space appear to be motivated by short-term profits rather than long-term conviction. He argued that weaker players may eventually be acquired at a discount by stronger firms, though he believes the trend could still see “a few more legs.”

Skepticism around the sustainability of the Bitcoin treasury trend is growing. A venture capital firm warned that only a few Bitcoin treasury companies are likely to survive long term without falling into a “death spiral” as their stock prices converge with the value of their BTC holdings. This warning echoes recent comments from Matthew Sigel, head of digital asset research at VanEck, who has voiced concerns over the Bitcoin treasury strategies adopted by some publicly traded firms. Sigel singled out the use of at-the-market (ATM) share issuance programs, arguing that these can become dilutive if a company’s stock price nears its Bitcoin net asset value (NAV).

Meanwhile, a law firm has filed a class action lawsuit against Michael Saylor’s Strategy, accusing the Bitcoin-focused firm of misleading investors about the profitability and risks of its crypto investment strategy. This lawsuit adds to the growing concerns about the long-term viability of the Bitcoin treasury strategy. Check’s warnings and the increasing skepticism from industry experts suggest that the Bitcoin treasury boom could be short-lived, and new entrants may struggle to sustain their strategies in the face of market saturation and investor scrutiny.