Trump Crypto Ally David Bailey’s Bitcoin Bet Lost 99% Of Its Stock Value. Now He’s Rebuilding The Business.
David Bailey’s Nakamoto is shifting away from the financing model that helped turn it into one of the most prominent Bitcoin treasury companies, searching instead for businesses that generate cash after its shares collapsed about 99% from their 2025 peak.
Bailey, a crypto entrepreneur who helped build industry support for President Donald Trump, told Bloomberg that Nakamoto is looking for acquisitions that can improve income and cash flow while supporting its broader Bitcoin strategy. With the stock now trading below the value of the company’s Bitcoin holdings, issuing new shares to finance additional cryptocurrency purchases has become far less attractive.
The company was created through the merger of Bailey’s Nakamoto Holdings with healthcare company KindlyMD, a transaction initially backed by a $510 million private investment and $200 million in convertible notes.
Nakamoto’s finances deteriorated sharply as Bitcoin prices fell and investor enthusiasm for digital-asset treasury companies faded. The company reported a net loss of $371.8 million for the first six months of 2026, according to its latest SEC filing, while second-quarter results showed it held about 4,467 Bitcoin worth roughly $261.5 million at the end of June.
Pressure on the balance sheet has already forced Nakamoto to reduce leverage rather than keep accumulating Bitcoin. The company said in its second-quarter results that it sold roughly 600 Bitcoin and related derivative positions for about $48 million in net proceeds, using much of the money to repay $45 million of Bitcoin-backed debt. It ended June with $19.1 million in cash and $164.7 million in total debt.
The collapse in Nakamoto’s stock also forced the company to carry out a 1-for-40 reverse split in May to regain compliance with Nasdaq’s $1 minimum bid-price requirement. The SEC filing announcing the move showed that the split reduced outstanding shares from about 696.1 million to approximately 17.4 million.
Nakamoto has since been directing more attention toward repurchasing its discounted shares. Its board authorized a buyback of up to $25 million in June, while the company also reduced debt and extended about 105 million USDT of principal until June 2027, according to a company announcement.
The company’s troubles are part of a wider reversal for Bitcoin treasury stocks, with a Financial Times analysis finding that companies built around holding Bitcoin had lost more than $80 billion in market value since mid-2025 as premiums over their cryptocurrency holdings disappeared.
Bailey is now betting that operating businesses can provide the cash Nakamoto once expected to raise easily from equity markets. The company completed acquisitions of BTC Inc. and UTXO Management in February, issuing stock valued at about $81.6 million to bring the two Bailey-led businesses under Nakamoto, the company said.
