NAKA shares plunge 54% in a day, reinforcing investor exhaustion toward Bitcoin treasury companies

Core Viewpoint - KindlyMD's stock has experienced a significant decline due to equity dilution concerns and investor fatigue towards digital asset treasury strategies, particularly in the context of Bitcoin investments [1][2][3]. Company Summary - KindlyMD, a Nasdaq-traded medical firm, transitioned into a Bitcoin treasury company after merging with Nakamoto in August and plans to raise up to $5 billion through an at-the-market stock program to expand its Bitcoin reserves [2]. - The company made its first purchase of approximately 5,744 BTC valued at $635 million earlier this month [2]. - The stock price peaked above $15 in late August but has since dropped to $1.28, reflecting a 54% decline in just 24 hours and over 90% in one month [1][2]. Industry Summary - Grayscale's August report highlighted growing investor exhaustion towards digital asset treasury (DAT) companies, noting that Bitcoin exchange-traded products experienced their first monthly net outflows since March, totaling $755 million in redemptions [4]. - The mNAV ratios for major DAT companies have converged toward 1.0, indicating a balance between supply and demand, suggesting that investors are no longer willing to pay premiums for crypto exposure through public equity instruments [5]. - Despite the apparent exhaustion regarding Bitcoin treasury companies, new digital asset treasury announcements for altcoins like Solana and Cronos continue to emerge, indicating ongoing interest from sponsors [6]. - Bitcoin's price uncertainty further complicates the situation, as the market value of companies like KindlyMD becomes closely tied to BTC's performance rather than their underlying business fundamentals [7].