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Bitcoin Treasury Firms See Share Prices Plunge as Crypto Rally Fades

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Shares of companies that buy and hold bitcoin and other cryptocurrencies on their balance sheets have slumped sharply, reflecting the cooling of the crypto frenzy that has dominated markets through much of 2025.

These “digital asset treasury companies” — firms that raise cash through stock sales or debt to purchase crypto — had soared earlier this year as bitcoin hit record highs and U.S. President Donald Trump threw political support behind the sector. Now, with sentiment fading, many are facing steep reversals.

Key Declines

  • MicroStrategy (Michael Saylor’s firm): Shares slid from $457 in July to $328, their lowest since April, cutting 2025 gains to just 13%.

  • Metaplanet (Japan): Down 60% from June peak, though still up 105% year-to-date.

  • Smarter Web Company (UK): Shares fell 70% since June after pivoting to a bitcoin-buying strategy.

  • Alt5 Sigma: Down 61% from June high, even after announcing a $1.5B deal with Trump’s World Liberty Financial crypto venture.

  • BitMine (Peter Thiel-backed) and GameSquare: Both plunged about 67% since July after ether-buying announcements.

Analysts’ Take

The pullback highlights the speculative nature of these stocks.

  • “These are essentially volatility plays … if bitcoin is down 3%, they’re down four or five times as much,” said Kaiko’s Adam McCarthy.

  • “Beyond their bitcoin exposure, most have only modest fundamentals, so their valuations don’t have much of a cushion,” added Lale Akoner of eToro.

  • McCarthy warned that some firms are “selling a crypto narrative to pump their equity value” rather than building sustainable businesses.

Bigger Picture

  • At least 61 public companies worldwide (outside the crypto sector) have adopted bitcoin treasury strategies, Reuters reported earlier this year.

  • When share prices tank, some firms’ market value dips below their crypto holdings, raising questions about sustainability.

  • Companies also risk losing access to capital markets to fund further crypto purchases when sentiment turns negative.

What’s Next

While treasury-driven crypto hype is faltering, the broader sector remains active. Gemini, the exchange founded by Cameron and Tyler Winklevoss, is set to debut on Nasdaq Friday, targeting a valuation of up to $3.08 billion after raising its IPO price range.

Bitcoin Surges in 2024, Fuelled by ETF Approval and Trump Optimism

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Bitcoin has more than doubled in value in 2024, reaching new heights following the approval of exchange-traded funds (ETFs) tied to its spot price by U.S. markets regulators and growing optimism over regulatory changes with Donald Trump set to return to the White House. Earlier this month, the cryptocurrency hit a significant milestone, surpassing $100,000, sparking renewed excitement among its supporters.

The cryptocurrency sector has experienced substantial growth this year, with Bitcoin surging more than 120% and Ether, the second-largest cryptocurrency, rising nearly 50%. This surge has propelled the market’s overall value to approximately $3.5 trillion, according to data from CoinGecko. Analysts predict that the momentum will continue into 2025, with some projecting Bitcoin could reach $200,000 by late next year.

MicroStrategy, a software firm that has become the largest corporate holder of Bitcoin, has seen its stock price soar nearly five-fold in 2024. The company’s stock is now considered a proxy for Bitcoin, with its price movements closely linked to the sentiment surrounding the digital asset. Other smaller companies are following suit, allocating portions of their cash to Bitcoin.

In a client note, analysts at brokerage firm Bernstein stated that they expect Bitcoin to evolve into a premier “store of value” asset, potentially replacing gold within the next decade and becoming a staple of institutional multi-asset allocation and corporate treasury management.

The surge in Bitcoin’s value began in January when the U.S. Securities and Exchange Commission approved the first ETFs tracking Bitcoin’s spot price. This approval marked a significant turning point for the cryptocurrency industry, giving it institutional legitimacy and broadening its appeal to mainstream investors. Major finance firms such as BlackRock and Fidelity launched Bitcoin-related ETFs, further strengthening the asset’s position.

Additionally, the election victory of Donald Trump, who has pledged to make the U.S. the “crypto capital of the planet,” boosted optimism in the sector. Trump’s pro-crypto stance attracted substantial donations from crypto advocates who hoped to elect candidates favorable to the industry.

The 2024 rally also benefited various crypto-related stocks, with winners including MicroStrategy, crypto exchange Coinbase, and Bitcoin miner Hut 8. However, some crypto miners faced challenges due to shrinking profit margins caused by rising energy and hardware costs, leading to significant losses. Riot Platforms, Marathon Digital, and Bit Digital saw declines of 26% to 32% in their stock prices this year.