Will Bitcoin Treasury Companies Get Rekt? with Jad Mubaslat | SLP679

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Aug 2, 2025

Jad Mubaslat, an engineer at Synota and a passionate Bitcoiner, shares his insights on the pitfalls of Bitcoin treasury companies. He raises skepticism about their sustainability, emphasizing concerns about cash flow and financial engineering. The discussion covers the implications of different investment instruments like convertible notes and preferred shares. They contemplate the risks of investing in these companies, the importance of self-custodying Bitcoin, and historical parallels to financial bubbles, urging caution for investors in this evolving landscape.

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INSIGHT

Lack Of Cash Flow Concern

Bitcoin treasury companies lack cash flow and rely mostly on Bitcoin holdings without generating sustainable business returns.
This structure implies hidden leverage and financial engineering rather than true business innovation.

INSIGHT

MNAV Premiums And Volatility

Treasury companies' stock prices often trade at premiums above the Bitcoin they hold, driven by speculative retail mania.
These premiums can compress in both bull and bear markets, causing volatility beyond underlying Bitcoin price moves.

INSIGHT

Tax Advantages Boost MNAV

Tax and regulatory factors can justify a market value to net asset value (MNAV) premium for treasury companies in some jurisdictions.
Examples include Japan's tax treatment and UK retirement accounts that restrict direct Bitcoin purchases.

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In this episode, Stephan Livera and Jad Mubaslat discuss the emerging trend of Bitcoin treasury companies, exploring the potential risks and rewards associated with investing in these entities. Jad expresses skepticism about the sustainability of these companies, particularly regarding their cash flow and financial engineering strategies. The conversation delves into the implications of convertible notes versus preferred shares, tax considerations, and the historical context of financial bubbles. Ultimately, both acknowledge the importance of self-custodying Bitcoin while considering the role of treasury companies in the evolving financial landscape.

Takeaways

🔸Jad Mubaslat expresses skepticism about Bitcoin treasury companies.

🔸The lack of cash flow in many treasury companies raises concerns.

🔸Convertible notes and preferred shares have different implications for investors.

🔸Tax implications can affect the market value of treasury companies.

🔸Market dynamics may lead to a winner-takes-most scenario in different jurisdictions.

🔸Historical financial trends provide context for current treasury company dynamics.

🔸Regulatory changes could impact the future of Bitcoin treasury companies.

🔸Investors should be cautious about the risks associated with treasury companies.

🔸Self-custodying Bitcoin is emphasized as a priority for investors.

🔸The conversation highlights the importance of understanding financial structures.

Timestamps:

(00:00) - Intro

(01:08) - Who is Jad Mubaslat?

(03:30) - Jad’s skepticism towards Bitcoin Treasury Companies

(08:39) - Who gets rekt?; mNAV compression

(13:02) - Sponsors

(14:55) - Convertible notes vs Preferred shares; Tax implications for investors

(21:42) - Strategy’s preferred share offerings; Risk-adjusted investment scenarios

(31:54) - Will BTCTCs continue to exist?

(34:24) - Will regulatory frameworks make it easier for BTCTCs to thrive?

(38:48) - What does the future look like for BTCTCs?

(43:23) - ‘Winner takes most’ & the end game for BTCTCs

(49:22) - Comparing Bitcoin Treasury Companies with the stock bubble of 1920s

(1:00:04) - Closing thoughts

Links:

Sponsors:

Bold Bitcoin
CoinKite.com (code LIVERA)

Stephan Livera links: