I wanted to write out some long form thoughts on the Bitcoin Treasury Company (BTCTC) space and why the price action has been so weak in recent months, both in general and specifically as it pertains to my two largest equities positions - Metaplanet (eight figs) and The Smarter Web Company (seven figs). While not active on X at the time, I made most of my current bankroll as an MSTR investor, buying shares and leaps in the 2022 bear market. Over the past six months, I’ve rotated the entirety of my MSTR position into Metaplanet $MTPLF $3350.T and more recently, a portion into The Smarter Web Company $SWC $TSWCF. While I still believe MSTR will forever remain the dominant BTCTC, and may one day become the most valuable company in the world, due to its massive size it is no longer in the hyper growth stage of Bitcoin accumulation that I believe Metaplanet and SWC are in, and so I have adjusted my portfolio accordingly.  Let's start off with unpacking what has caused the market-wide downturn and mNAV compression across the entire space. Many have called out broad market weakness across Bitcoin treasury companies, but I have not seen a thorough discussion of its causes, and where we can expect to go from here. I believe the downturn has been driven by a confluence of headwinds over the past couple of months, affecting the market broadly, in addition to a few specific factors which have handicapped Metaplanet and SWC on an individual basis. Regarding the broader market, I believe the weakness has been caused by, among other things 1) cool-off after a mania period 2) problems with PIPE-based BTCTCs 3) the beginning of alt season 4) the emergence of ETH treasury companies. 1) Starting off with the overall BTCTC landscape, there's no doubt we witnessed a mania phase during June which saw dozens of new companies announce Bitcoin treasury strategies and mNAVs expand to hard-to-justify multiples. This oversaturation of new companies diluted capital across the space; following a short period of mania, there was simply not enough new investor demand to satisfy all of these companies' funding requirements. In addition, many of these new entrants did not have genuine intentions, with questionable leadership or undesirable and unprofitable core businesses. Several never followed through with adopting a Bitcoin accumulation strategy, leaving shareholders stuck in illiquid positions. Since the height of the frenzy, as investors have taken losses and exited these positions, mNAVs have collapsed across the board, dragging down multiples for more established players like Metaplanet and SWC which have been genuine and shareholder-friendly in their execution of the playbook and have developed sustainable strategies to increase Bitcoin per share. While in hindsight the mNAVs of these two companies at the height of the mania now look extreme (Metaplanet as high as 8x, now down 75% to 2x; SWC as high as 15x+, now down 90%+ to 1.5x), I believe their current depressed mNAVs are equally illogically skewed to the downside. SWC's mNAV implies the market believes they will only ever hold at most ~5,000 BTC, which will prove to be irrationally bearish once their flywheel starts back up. During this corrective period, the most well-run companies have continued to stack BTC as aggressively as they were able. Looking at the history of the longer-established players, Strategy and Metaplanet, mNAVs have always traded in boom and bust cycles, so this cool-off is nothing new, and I expect an upswing in the future once bearish sentiment abates, new capital is attracted, and investors consolidate their positions in those with established tools and proven execution track records. Continued… ⬇️

my claim to fame 😂