Bitcoin Treasury Companies are the bubble of this cycle, say experts

Bitcoin commentators have been raising concerns over recent public companies adopting Bitcoin centric treasury strategy. This debate erupted this week when pseudonymous investors Stack Hodler and (@stackhodler) Some have described this trend as an uncontrollable speculative madness disguised under corporate forms. writing On X, “Bitcoin treasury companies are this cycle’s shitcoins.” He argues that these companies are “creating shares out of thin air to sell to people hoping to outperform Bitcoin,” BTC was their primary product. “It’s just TradFi shitcoinery,” He was warned. “And many will get rekt.”

Stack Hodler permitted that these companies These altcoins are currently being soaked up by speculative liquid that could otherwise go after illiquid ones. “But the bad news is that many of these businesses will inevitably be forced to dump their stacks one day,” He pointed out that the short-term investor may realize holding shares in Bitcoin proxies is less efficient than keeping their own Bitcoins. “Fiat shenanigans with the potential to unwind” He framed his model in a certain way. In contrast, he celebrated companies that generate real economic value and use their profits to accumulate Bitcoin—something he views as a sustainable force in Bitcoin’s monetization arc.

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Bitcoin Podcaster Stephan Livera joined the discussion by referring to MicroStrategyMichael Saylor, in the Q1 2025 results call of the company, explained why the premium the firm continues to pay over its net asset values. “Saylor outlined some reasons for MSTR being at a multiple to NAV,” Livera said. While acknowledging the cyclical nature of that premium—comparing it to the GBTC discount blowout in the previous cycle—he argued there’s a broader structural context. “Bitcoin is a $2 trillion asset in a world of $1,000 trillion in assets,” Livera explained that many capital investors are unable to hold Bitcoin directly due to restrictions relating to taxation, regulation, and mandates. “There’s a case for some treasury companies to exist long-term, so long as they’re managed prudently.”

Bitcoin Treasury Surge: A Copy-Cat Surge

But Stack Hoffler wasn’t referring MicroStrategy. “I’m talking about the copycats that are popping up at an accelerating pace,” He responded. “They’re trying to draft off MSTR’s success, similar to how shitcoins drafted off of BTC’s success.” He did not deny the possibility that some of these companies could benefit from regulatory arbitrage in the short-to-medium term. However, he questioned the viability for firms whose main activity is to print shares and use the proceeds to purchase Bitcoin. “I love seeing companies with real profitable businesses stack BTC. Fiat engineering seems shakier to me long-term.”

Scott Melker is the host of “The Wolf of All Streets” podcast, added To the discussion: “I hate to even think this, because I’m a huge fan—but Bitcoin treasury companies raising debt to buy Bitcoin could be the next bubble.” Dave Weisberger, a market structure analyst, agreed with the risk but expressed a more moderate stance. “Sure. But bubbles have to inflate before we worry about them… spoiler, Bitcoin is NOT near bubble territory.”

FiboSwanny – a market veteran of 25 years focusing on leverage and structure – is a Technical Analyst. “If there’s a bubble forming, it’s likely in the financial instruments and leverage around Bitcoin,” He cited debt-funded Treasury purchases, ETFs and derivatives. “Not in actual Bitcoin itself.” Lark Davies took on a more gloomy tone. “This is our GBTC leverage this cycle that will have a horrific unwind with devastating consequences later. Especially the companies buying altcoins.”

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Swan CEO Cory Klippsten didn’t mince words either. “Already jumped the shark,” He has written. “Have been predicting it for a year, but it’s inevitable now.”

Currently, there are dozens of companies that have direct Bitcoin investments. Some of these public companies attract intense retail speculation. MicroStrategy continues to be the leading force with over half a Million Bitcoin in its accounts. Some other names are Metaplanet Semler Scientific in Japan and KULR technology, along with other companies, have redirected their entire corporate missions to Bitcoin acquisition. These firms now trade at valuations that are many times higher than their business models.

However, the viability of the current model still remains to be seen. The majority of these firms rely heavily on issuing equity with inflated values to fund future Bitcoin purchases. This dynamic is great in bull markets, but it can quickly reverse in downturns.

As institutional exposure becomes more complex, the debate about how to structure it is increasingly important. Stack Hodler put it very simply: “Bitcoin is and always will be the best risk-return asset to hold in this space. Part of successfully holding Bitcoin is being able to resist all the ‘better Bitcoins’ that inevitably arise during your journey.” One of the most important questions in this cycle remains whether or not the new class Treasury companies represent innovation, opportunism or simply a balloon waiting to burst.

BTC was trading at $103,709 as of press time.

Featured Image created using DALL.E and chart from TradingView.com