• Bitcoin treasury stocks show signs of recovery as Kynikos Associates closes MSTR short.
• MSTR’s mNAV drop highlights potential undervaluation of the company’s stock.
• US Senate deal to end shutdown boosts investor confidence, lifting Bitcoin price.

Bitcoin treasury stock is also beginning to experience an imminent recovery because Kynikos Associates, a large investment company, terminated the Strategy (MSTR) short position. This development is an indication that the bear market on Bitcoin treasury companies is possibly coming to an end.

James Chanos, the founder of Kynikos associates, unveiled that his company was liquidating a short on MSTR and unwound a long on Bitcoin. The value of the stock of MSTR, holding the biggest corporate Bitcoin collection, reduced by almost half since its 2025 peak. The market Net Asset Value (mNAV) of the company is currently at 1.23x; it was approximately 2.0x in July.

Chanos Closes Short Position Amid mNAV Drop

According to Chanos, the firm decided to close its short position because the mNAV had declined tremendously. The implied premium of the company was decreased from $70 billion to $15 billion in July as they are computed by deducting the worth of its Bitcoin positions from its business worth. 

This fall is an indication that the stock of MSTR may have been underestimated, but Chanos had reported that the company may continue to experience mNAV compression, particularly upon issuing additional equity.

Also Read: Coinbase Highlights Leverage Reset and Institutional Strength in Crypto Recovery

This reflects a broader trend affecting Bitcoin treasury companies. The market cap of many publicly traded companies that hold Bitcoin has severely declined during the past several months. The market capital of Strategy has declined by 43%, given that its market capital was $122.1 billion in July and stood at $69.5 billion on the last Friday.

Bitcoin Treasury Strategies Questioned as Companies Sell Holdings

Metaplanet, the highest-performing stock at the beginning of 2025 on the Tokyo Stock Exchange, has witnessed a 56% plunge in its market cap since June. A few companies that own BTC have had to sell off their BTC holdings in order to settle their debts. The development of this trend causes the question of the feasibility of crypto treasury strategies in the long term.

The US government shutdown has been one of the major factors in influencing the market. Nevertheless, on Sunday, there were reports that the Senate had agreed to its package of budget bills, terminating the shutdown. Digital currency reacted fast, increasing 2% to 106,430 in simply 50 minutes of news.

The shutdown could end and stimulate investor confidence in the crypto industry. With the signs of recovery in crypto treasury stocks, a lot of investors are optimistic that the market is turning back.

Also Read: Bitcoin Power Law Predicts $142,000 Fair Value and Bullish Breakout