Bitcoin Treasury Companies are a Bad Idea
Asset selection doesn't obviate innovation
Debanking is a symptom, not the cause
Over the weekend, Nellius Irene at Cryptopolitan reported that JPMorgan Private Bank has continued debanking bitcoin-related companies–a clear violation of an August 7, 2025 Executive Order “Guaranteeing Fair Banking to All Americans”. Of course, by the time a customer is debanked the damage is already done. Banks can close a customer’s account leaving them without a banking relationship, forcing them to scramble and find an alternative solution. Even if the offending bank later gets its hand slapped by regulators, the customer has already been inconvenienced and in many cases, has suffered severe financial harm. Both JPM and Bank of America are dealing with investigations as to their actions, so watch this space.
But continued debanking is only part of the story, and it isn’t the most important part. The broader point is that JPM appears to be reinforcing its anti-crypto posture as MSCI Inc. announced that it’s exploring the possibility of delisting “Bitcoin Treasury Companies” from its major indices. MSCI’s report describes companies that hold > 50% of their balance sheet in Bitcoin or other cryptocurrencies as “investment funds” and don’t consider them to be “operating businesses”. They claim that as such, the companies are not eligible to be listed on MSCI’s indices. Published reports of the news necessarily reference Strategy Inc., Michael Saylor’s unapologetically structured supermassive black hole that seeks to suck 1,000,000 bitcoins into its gravity well.
This may be fair play as to Strategy, as MSTR and its now-expanded family of tickers are explicit bitcoin plays, promoting various forms of “amplified bitcoin”. In the bitcoin space, MSTR was long considered a proxy for a bitcoin ETF before Blackrock’s IBIT and the host of other bitcoin Exchange Traded Products found SEC approval last year. But the report also references publicly-traded bitcoin mining companies RIOT and MARA. This seems a bit incongruous, as bitcoin mining companies are indeed “operating companies”. They just may not be operating companies that MSCI wants to reference in its indices.
As the news percolated into markets over the weekend, bitcoin continued shedding fiat value. At this writing, bitcoin has lost roughly 30% from its October 2025 all-time high. MSCI’s reports come amid broader concerns of a mounting “crypto winter” and public firms holding corporate digital-asset treasuries have collectively lost nearly half of their combined market capitalization.
As Saylor leads, many follow
In 2025, public sentiment shifted dramatically in favor of bitcoin and to a lesser degree, the broader ecosystem of “crypto assets”. Retail investors have invested many tens of billions of dollars into various bitcoin ETPs, and bitcoin enjoyed consistent daily prices over $100,000 US for many months. Buoyed by the price of bitcoin and an aggressive (ahem!) strategy of issue debt…buy bitcoin…issue debt…buy bitcoin, Strategy Inc. has dominated headlines. Michael Saylor has extended his “mega-bull” celebrity status and is a frequent headline fixture in conference, financial news, and podcast circuits. According to SEC filings and their own website, Strategy Inc. holds ₿ 649,870, a fair quantity higher than all bitcoin-holding countries combined.
Many dozens of public companies are following Saylor’s lead, seeking to amass bitcoin in corporate treasuries. Presumably, this is to serve as a hedge against fiat currency debasement, and to otherwise build value in the company in ways that are theoretically independent of the company’s performance.
Viewed solely through orange-tinted glasses, this movement looks bullish. Strategy has benefited from bitcoin’s price appreciation this year and others now want in on that action. A self-proclaimed bitcoin-friendly administration in the White House paired with legislative momentum in Congress suggests that bitcoin has shifted squarely in front of the Overton Window as mainstream investors, policy makers, and companies perceive bitcoin as a viable asset to store value. In a market of rising bitcoin values, these companies look like geniuses. But have they stopped becoming companies?
Viewed more cynically, the shift for companies to become “bitcoin treasury companies” suggests their management may be out of profitable ideas. To the extent a company shifts more than half of its treasury into bitcoin, it begs the question as to whether the company still has a viable business model independent of the value of bitcoin on the balance sheet. The company could be bleeding out in every possible measure but if bitcoin is doing well, the company looks good. How many bitcoin treasury companies are the next generation of zombie companies feeding on the glucose of bitcoin’s price action? What happens when price keeps retracing?
Perhaps we will see fairly soon. If crypto winter is coming– and the forecast looks bleak, although some holdouts remain–and if MSCI moves to delist Strategy and other bitcoin treasury companies, the companies will be forced to make a choice. Will they bear the stigma and economic loss from delisting, or will they offload BTC from treasury to get below the 50% threshold? If the companies liquidate BTC into a declining market, the influx of sell pressure will surely push bitcoin lower.
It’s hard to imagine Michael Saylor backtracking on his frequent, impassioned public commitment to accumulate bitcoin NO MATTER WHAT. But when MSCI delists a company, that action automatically triggers forced selling by index funds, reduces institutional demand and visibility, shrinks liquidity, and tends to put sustained downward pressure on the stock’s valuation. How much pain will shareholders endure before management is forced to sell treasury assets?
The lumpy ride to a treasury asset
The appeal of bitcoin on the balance sheet–both personal and corporate–is understandable. In its nearly 18 years bitcoin has gone from fringe cypherpunk experiment in peer-to-peer electronic cash to a store of value asset that has performed unlike any other asset in human history. As I’ve written about previously, barring an existential failure bitcoin can’t help but go up when compared to any other monetary system. While this truth is inescapable, the trajectory is far from smooth. Bitcoin has been having its moment in the sun but the voracity of the retail market has caused bitcoin’s price to get out over its skis. Potentially WAY over its skis.
This is not to say that bitcoin is doomed; far from it. But the speculative price action that 2025 has seen is the result of investor euphoria riding the sugar high of the ETF listings, the 2024 Presidential Election, and billion-dollar crypto memery (read: utter shitcoinery) oozing from the White House and First Family.
Bitcoin’s history as the world’s first–and only–truly decentralized blockchain network probably merits clear-eyed consideration for its tokens (“bitcoins”) to be included on every balance sheet. It has simply performed too well against literally everything else to ignore its value. But bitcoin should not define the balance sheet. Especially public companies that are supposed to build stuff and do stuff independent of the assets in their treasury. The treasury should support and sustain the company; it shouldn’t BE the company.
Bitcoin’s fiat-denominated price has historically followed cycles tied to the halving mechanism, general ebbs and flows of sentiment within a relatively small cohort of users/investors, and in more recent years, growth in M2 (usually subject to a lag). As bitcoin has increasingly entered the financial zeitgeist, growth in investor demand–against bitcoin’s certain issuance rate and fixed, finite supply–has had a predictable impact on bitcoin’s price. And as past is prologue, every new cohort of Bitcoiners must experience the euphoria-despair cycle as price stretches and then violently snaps back.
A new test for the class of 2024
As crypto winter looms and bitcoin’s price retreats, the new cohort of Bitcoiners may be in for a shock. This new cohort isn’t made of diehards who have held bitcoin through adverse administrations and through prior eras of negative sentiment. The pre-2024 class of Bitcoiners are used to wild price swings, mockery by friends and family (and for many of us, our colleagues), and fear that government would outlaw the asset.
Most of those challenges are gone, but the class of 2024-2025 is different. The buyers are retail investors, family offices, endowments and increasingly, public companies. They don’t care a whit about bitcoin’s core quality: facilitating direct peer-to-peer financial transactions without intermediaries. They’ve seen the price action and have declared it as gooooood. Increasingly, those accumulating bitcoins ARE the intermediaries. Their big bags of money have pried the coins from OG hands who have now become richer than Scrooge McDuck.
I don’t blame the OGs for selling into the market and to a large degree, the market has become the intermediaries. Early adopters have been well-rewarded for their early conviction. If I had had the same opportunity, I’d have taken it myself. But this presents an irony and perhaps a corruption of what made Bitcoin bitcoin.
Bitcoin isn’t at risk, but corporate cosplay is. A decentralized monetary asset doesn’t care who holds it, and it doesn’t genuflect for index committees. If MSCI only wants operating companies, then operating companies must act accordingly. We may be about to find out who actually builds something and who’s just scribbling “₿itcoin NGU” across a dying business model.
The irony of the moment is hard to miss: holders of a network asset designed to circumvent banks are quavering because banks and index providers don’t like how companies are holding it. This pain will be temporary; bitcoin’s trajectory is unstoppable. But it also operates in a powerful legacy fiat system whose rules are impossible to ignore.
Companies whose economic viability depend on listing by MSCI or banking by JPM and its ilk may find themselves at a crossroads: continue to play by centralized intermediaries’ rules, or permanently opt out of their system and fully commit to a Bitcoin Standard. Bitcoin Treasury Companies will have to decide if bitcoin is a substitute for innovation, or if bitcoin is the innovation.
A crypto winter may force the choice.