The Net Asset Values (NAVs) of Digital Asset Treasuries (DATs) have sharply decreased. However, analysts from 10x Research suggest this may not be entirely negative, highlighting potential opportunities for discerning investors.

“The age of financial magic is ending for Bitcoin treasury companies,” remarked analysts from 10x Research in a report shared on Friday.

They explained that prior to this decline, some companies generated substantial “paper wealth” by offering shares significantly above their actual Bitcoin value, creating an illusion now dissipated.

In what the analysts describe as a “magic trick,” DATs transferred wealth from retail investors, who effectively overpaid, to their actual Bitcoin holdings. Consequently, while shareholders faced losses amounting to billions, executives benefited by holding genuine Bitcoin.

For instance, the fourth-largest Bitcoin treasury firm, Metaplanet, exemplifies this scenario. It managed to transform its market cap from $8 billion—supported by only $1 billion in Bitcoin holdings—down to a market cap of $3.1 billion but backed by $3.3 billion in real Bitcoin.

A Similar Situation for Strategy

Retail investors previously paid two to seven times more than Bitcoin’s actual value for shares during the hype. Now, many find themselves in an undervalued scenario while companies utilize their inflated capital to acquire genuine Bitcoin.

According to the report:

“With NAVs now having fully round-tripped, retail investors have lost billions—and many likely lack the conviction to keep adding to their positions.”

Emergence of New Bitcoin Asset Managers

The normalization of NAVs has opened unprecedented opportunities for astute investors. Firms trading at or below NAV currently provide straightforward Bitcoin exposure, with additional prospects for generating returns from trading profits.

The aftermath of this event will differentiate true operators from mere promotional firms. Those that adapt effectively will emerge as capable managers of Bitcoin assets, ready to define the next bullish trend.

The analysts concluded that:

“Bitcoin itself will continue to evolve, and Digital Asset Treasury firms with strong capital bases and trading-savvy management teams may still generate meaningful alpha.”

Market Watch: Saylor’s Strategy and Metaplanet Stocks Decline

On Friday, Strategy (MSTR) stock increased by 2%, closing at $289.87. Nevertheless, it has suffered a notable decline of 39% from its peak closing price in November 2024, as reported by Google Finance.

Meanwhile, Metaplanet shares (MTPLF) fell by 6.5% on the Tokyo Stock Exchange, landing at 402 yen ($2.67), marking a staggering 79% decline since reaching their peak in mid-June at 1,895 yen ($12.58).

Metaplanet stock’s boom and bust. Source: 10x Research

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