2025 has been a very good year for digital asset treasury (DAT) companies, especially Bitcoin and Ethereum treasury vehicles. These publicly traded companies, which have accumulated digital assets on their balance sheets, offer indirect cryptocurrency exposure to retail investors who purchase their shares.
However, a recent report found that retail investors lost about $17 billion by investing in Bitcoin treasury stocks. According to the company, the hype surrounding BTC government bonds appears to be coming to an end, and retail investors are being forced to deal with losses.
Has the Bitcoin government bond bubble burst?
10x Research said in a market report last week that the “magic era of finance” is coming to an end for Bitcoin treasury companies. The Singapore-based research firm said these financial firms created billions of dollars in “paper wealth” by issuing overvalued shares to investors.
The analytics firm says it makes sense for the Treasury to sell its shares at a premium as the price of Bitcoin continues to rise. 10x Research noted that the once-lauded net asset value premium (NAV) was illusory, leaving investors with losses and “executives walking away with money.”
10x Research said investors who bought overvalued stocks during the Bitcoin bond boom collectively lost about $17 billion. Volatility and declining profits are forcing government bond companies to make a hard pivot from marketing-driven momentum to actual market discipline, the research firm said.
Source: 10x Research
10x research added:
The following act is not about magic. It’s about who can still generate alpha when the audience stops believing.
Unsurprisingly, the performance of Bitcoin stocks in recent months has been very disappointing. For example, MSTR stock in Strategy (formerly known as MicroStrategy) has fallen more than 20% since August.
The company, led by Michael Saylor, announced its latest Bitcoin purchases between October 6th and October 12th. The purchase of 220 BTC at an average price of $123,561 brought Strategy’s holdings to 640,250 BTC (worth approximately $47.38 billion).
bitcoin price overview
As of this writing, the price of BTC is around $106,799, with no significant movement over the past day. The leading cryptocurrency has struggled to maintain positive momentum after the market-wide crash on October 10th. According to data from CoinGecko, Bitcoin’s value has fallen by more than 4% in the past seven days.
The price of BTC on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured image from iStock, chart from TradingView
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