David Bailey’s Nakamoto crypto firm experienced a shareholder rout after he wrote to them suggesting they should sell up if they aren’t committed to the company’s long-term Bitcoin strategy vision. Nakamoto, which goes by its parent company’s name KindlyMD on the Nasdaq stock exchange, while trading under the ticker NAKA, posted a 55% decline from last week’s close to the end of trading on Monday and is heading for a fifth straight week of losses despite a partial rebound on Tuesday.
Nakamoto Holdings Crashes 55% in a Day as Market Cap Falls Below BTC Value
17 September 2025 - 17:56 CEST
At Bitcoin’s current price, Nakamoto’s BTC holding is worth just over $671 million. Its market capitalization on Wednesday was $564 million.
Importance of conviction
The immediate context for Bailey’s letter is the potential for further price volatility as the company launches a private investment in public equity (PIPE) fundraising.
“This transition may represent a point of uncertainty for investors, and we look forward to emerging on the other side with alignment and conviction amongst our backers,” Bailey wrote in the letter, a shareholder communication referring to a filing made at the Hong Kong Security and Futures Commission about the capital raise.
“For those shareholders who have come looking for a trade, I encourage you to exit,” Bailey added.
Different crypto treasury strategies
Bailey used the shareholder letter to reiterate the four elements of the company’s strategy:
- “Raise capital to build a Bitcoin-denominated treasury
- Invest our Bitcoin into Bitcoin-focused companies or companies with Bitcoin on the balance sheet (i.e., Bitcoin-backed securities) across markets and asset classes
- Earn Bitcoin-linked income by building a portfolio of Bitcoin-native operating companies
- Compound Bitcoin per share and repeat”
Nakamoto’s management has been seeking to integrate the cryptocurrency into existing financial systems, laying the groundwork for broader traditional finance involvement in BTC.
“Our mission is clear: build the leading Bitcoin-native financial institution,” Bailey said in his letter.
This differs from other BTC treasury strategies.
Michael Saylor’s Strategy, for example, is focused on maximizing shareholder value simply by using excess cash and fundraises to acquire more BTC indefinitely. Last week, it spent $60.2 million buying a further 525 BTC, bringing its total holding to 638,985. And its share price increased from September’s low of $321.39 on Monday to close on Tuesday at $335.09.
Downward trend
The wider context for Bailey’s letter is that the share price has been largely trending down since the May announcement of the merger between medical company KindlyMD and Nakamoto Holdings. On that news, the price jumped to an all-time high of $25.03 from the long-term trend in the $1-3 range. Aside from a mid-August spike when the two companies officially merged, the price has been dropping ever since.
Bailey’s ultimate objective is for the company to own one million BTC, known as a Nakamoto, hence the name. He is a widely publicised Bitcoin maximalist and an influential figure close to the Trump family, appearing frequently alongside Donald Trump’s sons at crypto-themed conferences. In August, Nakatomo announced it had bought 5,764.91 BTC. In addition, it has said it has invested $30 million in Metaplanet, the Japanese hotelier-turned-Bitcoin stockpiler which counts Eric Trump, son of Donald, among its advisers. And it made an undisclosed investment in Treasury B.V., a Dutch Bitcoin treasury company.
Growing Solana treasuries
Despite the difficulties Nakatomo is facing, cryptocurrencies treasuries are becoming increasingly popular and varied across different cryptocurrencies. According to Strategy SOL Reserve, Solana treasury holdings have now exceeded a total value of $4 billion, accounting for 3% of the total 600 million tokens in circulation.
Forward Industries is the largest holder, having acquired 6.8 million tokens, currently valued at around $1.6 billion, on Monday. Its approach is to stake its SOL tokens to generate additional yield. This exploits Solana’s proof-of-stake mechanism, which provides security by ensuring validators stake their SOL tokens to earn the right to produce blocks and validate transactions.
It seems that investors generally support the concept of crypto treasuries, even if they are currently unconvinced by Bailey’s approach and have dealt Saylor a 26% negative blow to Strategy’s stock since this year’s peak in July.
