What happened?
CryptoQuant warns that crypto treasury companies that raised capital via PIPE deals are seeing their stocks snap back toward the cheap PIPE issuance price and can fall sharply. We’ve already seen dramatic examples like Kindly MD (NAKA) and Strive (ASST) where shares surged on crypto pivots and then collapsed — NAKA plunged about 97% back to its PIPE price. The retracements are driven by dilution and heavy selling pressure when PIPE lock-ups expire, a phenomenon researchers call “PIPE price gravity.”
Who does this affect?
This mainly affects small-cap public firms that used PIPE financing to accumulate crypto or rebrand as treasury plays, along with their retail and institutional shareholders. Companies such as NAKA, ASST, CEP and other PIPE-backed treasuries are most exposed when investors dump shares after lock-ups lift. It also impacts lenders and the broader market since several firms are taking on debt to buy back stock, a sign of strain for companies trading below the value of their crypto holdings.
Why does this matter?
This matters because PIPE overhangs can drive big losses and sap confidence in the crypto-treasury trade, potentially knocking many stocks down 50% or more. With roughly one in four public Bitcoin treasuries trading below NAV and NAV multiples falling, widespread selling could compress valuations across the sector and push investors toward holding crypto directly instead of equities. Unless there’s a strong, sustained Bitcoin rally to absorb the selling, expect continued declines, more debt-fueled interventions, and higher volatility that could spill into related small-cap and SPAC markets.