Publicly traded companies accumulating Bitcoin may need to reconsider the strategy—especially if their share prices begin to slide—warns a VanEck executive, who believes at least one major Bitcoin-buying firm is nearing a tipping point.
Matthew Sigel, VanEck’s head of digital assets research, said in a post on X Monday that firms raising funds through large at-the-market (ATM) offerings to buy Bitcoin face a growing risk: “If the stock trades at or near net asset value (NAV), continued equity issuance can dilute shareholder value rather than enhance it.”
While no public firm has consistently traded below the value of its Bitcoin holdings, Sigel pointed out that Semler Scientific, Inc. (SMLR) is now “approaching parity.”
Semler Stock Plummets 50% Amid Bitcoin Surge
Semler, a medical technology company that began purchasing Bitcoin in May 2024, has since amassed 3,808 BTC—making it the 13th largest public holder, with assets valued at $404.6 million.
Despite Bitcoin reaching new highs throughout the year, Semler’s stock has dropped over 45% year-to-date as of Friday’s market close, bringing its share price back to levels seen when it first entered the crypto space. The decline has dragged the company’s market capitalization down to approximately $434.7 million.
According to data from Coinkite, Semler’s multiple of NAV (mNAV)—calculated by dividing its market capitalization by the value of its Bitcoin holdings—has fallen below 1x, currently sitting at approximately 0.821x.
Firms Investing in Bitcoin Urgently Need “Safeguards”
Like many other Bitcoin-buying companies, Semler has raised funds through multiple rounds of share and debt issuance to expand its Bitcoin holdings, with both the company and its investors betting that the cryptocurrency’s rise would boost Semler’s stock.
However, caution may be warranted. Sigel has urged Bitcoin-investing firms to “adopt safeguards now, while premiums still exist.” He recommended that companies suspend at-the-market offerings if their stock trades below a net asset value (NAV) multiple of 0.95x for at least 10 consecutive days.
Sigel also advised prioritizing share buybacks when Bitcoin appreciates but the company’s stock price fails to reflect that value.
If a persistent discount to NAV continues, he said, firms should consider launching a strategic review—potentially exploring options such as a merger, spinoff, or even winding down their Bitcoin investment strategy.
Tie Executive Pay to Company Growth — Not Bitcoin Holdings
Sigel emphasized that Bitcoin-buying companies should structure executive compensation around the growth of net asset value (NAV) per share, rather than the size of their Bitcoin holdings or the total number of shares outstanding.
He reiterated the need for disciplined decision-making while companies still have flexibility, warning, “Once you’re trading at NAV, shareholder dilution stops being strategic—it becomes extractive.”
