mNAV Collapse Forces Bitcoin Treasuries to Rethink Growth Models

MicroStrategy’s Bitcoin Correlation Shows Strain Amid Dilution Concerns

The recent consolidation in the Bitcoin treasury sector, exemplified by Strive, Inc.’s $1.6 billion all-stock acquisition of Semler Scientific, Inc., underscores growing challenges for companies relying on Bitcoin as a core asset. The combined entity, which now holds over 10,900 Bitcoin, represents one of the largest corporate Bitcoin treasuries. However, the deal highlights broader industry pressures, including narrowing premiums on net asset values (mNAVs) and concerns over equity dilution, which are straining the traditional correlation between Bitcoin treasury companies and the cryptocurrency’s price movements .

Strive’s purchase of 5,816 Bitcoin at an average price of $116,047 per coin—bringing its total holdings to 5,886 BTC—reflects aggressive accumulation strategies. Yet, the transaction’s structure, which includes issuing 21.05 Strive shares for each Semler share, introduces significant dilution risks. The deal’s 210% premium to Semler shareholders, while signaling market confidence, also raises questions about the sustainability of such valuations as Bitcoin’s price volatility and sector saturation intensify .

The mNAV metric, which measures a company’s enterprise value relative to its Bitcoin holdings, has become a focal point for investors. For MicroStrategy (Strategy), the mNAV has compressed from over 6.0x in 2021 to under 2.0x by mid-2025, according to analysis by NYDIG and Standard Chartered. This erosion reflects declining investor appetite for leveraged Bitcoin strategies and growing caution over dilutive financing. When mNAV dips below 1.0, companies lose the ability to issue shares at a premium to fund further Bitcoin purchases, effectively halting their growth engines .

The sector’s struggles are compounded by structural risks. Convertible debt and preferred equity, once tools for rapid Bitcoin accumulation, now expose firms to refinancing pressures in a tightening capital environment. For instance, Strategy’s $100 million in convertible debt due in 2030 could strain its balance sheet if Bitcoin enters a bear market. Additionally, regulatory scrutiny looms as some firms face potential classification under the Investment Company Act of 1940, which could restrict their inclusion in major indices .

Analysts suggest consolidation is inevitable. Standard Chartered predicts larger players, including Strategy and Strive, may acquire weaker peers trading at discounts to their Bitcoin holdings. The Strive-Semler merger, which aims to leverage a “preferred equity only” capital structure, is seen as a model for reducing debt-related fragility. However, the success of such strategies depends on maintaining investor trust in Bitcoin’s long-term value and the companies’ ability to execute disciplined capital management .

The Bitcoin treasury sector’s future hinges on balancing innovation with sustainability. While firms like Strive emphasize Bitcoin-per-share growth through equity financing, the market’s tolerance for dilution appears waning. NYDIG and others caution that mNAV metrics, which often exclude operational assets or assume full conversion of debt, may misrepresent a company’s true value. For MicroStrategy and its peers, the challenge lies in evolving beyond speculative arbitrage models to establish durable revenue streams and operational differentiation .

[1] Strive, Inc. (Nasdaq: ASST) and Semler Scientific, Inc. (Nasdaq: SMLR) (https://investors.strive.com/news-releases/news-release-details/strive-inc-nasdaq-asst-and-semler-scientific-inc-nasdaq-smlr)

[2] Strive to Acquire Semler Scientific in a $1.6 Billion All-Stock Deal (https://www.insidearbitrage.com/2025/09/strive-to-acquire-semler-scientific-in-a-1-6-billion-all-stock-deal/)

[3] NYDIG fordert Bitcoin Treasury-Unternehmen auf, die … (https://www.coindesk.com/de/business/2025/09/27/nydig-calls-for-bitcoin-treasury-companies-to-drop-misleading-mnav-metric)

[4] Digital Asset Treasuries in 2025: Bitcoin Leverage, … (https://coinspaidmedia.com/columns/digital-asset-treasuries-2005/)

[5] Digital Asset Treasuries Face mNAV Collapse, Standard Chartered … (https://cointelegraph.com/news/digital-asset-treasuries-mnav-collapse-standard-chartered)

[6] BTC Ends Weak Quarter Amid Seasonal Pressures as mNAV (https://www.coindesk.com/markets/2025/09/27/bitcoin-trails-equities-metals-and-usd-in-q3-here-is-a-key-level-to-watch-for-next-move)