LONDON — The Bitcoin treasury business model has officially failed, according to the Financial Times, after its two most committed practitioners deteriorated into a combined 868,206 Bitcoin.
The FT announced last week that Bitcoin treasury companies had shed more than $80 billion in market value as the “business model unwinds,” citing dozens of companies whose shares collapsed after executives discovered that changing the corporate strategy slide to “Bitcoin” did not automatically make them Michael Saylor.
The diagnosis came just before Strategy and Strive spent another $513 million demonstrating the severity of the failure.
Strategy purchased 4,603 Bitcoin for $369.7 million, bringing its holdings to 845,050 BTC. Strive acquired another 1,800 for $143 million, raising its holdings to 23,156 BTC. Together, the two companies have now collapsed into 868,206 Bitcoin, an advanced stage of corporate failure generally characterized by repeatedly accomplishing the thing the corporation says it exists to do.
“It’s important not to confuse execution with success,” explained one legacy financial journalist. “Yes, they’re raising capital. Yes, they’re buying Bitcoin. Yes, they’re building increasingly sophisticated securities specifically designed to raise more capital to buy more Bitcoin. But,” the journalist added, concluding his argument.
Analysts noted that the first-generation treasury trade really has been brutalized. Scores of copycats bought Bitcoin, briefly enjoyed inflated valuations, issued stock into those valuations and then learned that “owning the same asset as Strategy” was not technically a competitive advantage.
Strategy and Strive responded to this industrywide failure by continuing to build actual capital markets around the strategy.
Strategy now manages multiple classes of Bitcoin-backed preferred securities while maintaining billions in dollar liquidity to service and manage the capital stack. Strive, meanwhile, issued another 803,099 shares of its SATA preferred last week while purchasing 1,800 additional Bitcoin, an unusual restructuring technique known in finance as “doing exactly what you said you were going to do.”
Experts cautioned that the situation could deteriorate further if investors continue purchasing these securities, allowing the companies to acquire even more Bitcoin.
“At some point,” the analyst warned, “Strategy could own 900,000 Bitcoin and we may have to upgrade the model from ‘failed’ to ‘catastrophically failed.’”
At press time, Strategy and Strive had been asked to stop buying Bitcoin until everyone finished explaining why nobody wants to finance Bitcoin treasury companies anymore.
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