Bitcoin treasury companies have emerged as a significant trend in 2025, but a report from venture capital firm Breed suggests that only a few will survive a possible 'death spiral.' This decline is prompted by a decrease in Bitcoin prices, which affects a company's multiple of net asset value (MNAV) and can lead to margin calls. These calls force companies to sell Bitcoin, further depressing market prices and leading to consolidation among stronger firms. Breed identifies seven phases of this decline, emphasizing that strong leadership, disciplined execution, and distinct strategies are essential for survival. However, the report highlights that most Bitcoin treasury firms currently utilize equity financing, which may limit broader market fallout. A noteworthy concern is that if debt financing becomes prevalent in the industry, the situation could worsen, leading to more significant implications for the market.

Source 🔗