Bitcoin treasury firm Nakamoto is taking drastic measures to save its rapidly declining share price. On Friday, the company will move forward with a 1-for-40 reverse stock split in a crucial bid to maintain its active listing on the Nasdaq Stock Exchange.
With shares closing at a dismal 16 cents on Wednesday, the company has seen its market valuation severely compromised. The stock has plummeted more than 99% from its high of $25 last May, a peak that occurred shortly after Nakamoto merged with healthcare provider KindlyMD and first unveiled its ambitious Bitcoin treasury strategy.
Why Nakamoto is Executing a Reverse Stock Split
The primary catalyst for this financial maneuver is a looming deadline from the Nasdaq. Last December, the exchange issued a formal warning to Nakamoto because its stock had traded below the mandatory $1 minimum bid price for 30 consecutive business days. To avoid being officially delisted, Nakamoto has until June 8 to push its share price back over the $1 threshold and sustain that level for at least 10 straight days.
To force the share price upward, shareholders approved a reverse split ratio. By consolidating every 40 existing shares into a single new share, Nakamoto will drastically shrink its total outstanding common shares from 696.1 million down to just 17.4 million. While a reverse split does not inherently change the company’s total market value, it artificially boosts the price of individual shares, which should allow the firm to regain compliance with Nasdaq regulations.
Massive Q1 Losses and a Struggling Crypto Treasury Sector
Nakamoto’s stock struggles are deeply tied to its recent balance sheet and broader cryptocurrency market volatility. Despite reporting a massive 500% jump in revenue quarter-over-quarter, the company recently announced a staggering $238.8 million net loss for the first quarter. A massive chunk of that deficit—over $102 million—was a direct result of paper losses on its Bitcoin holdings, fueled by a 23% drop in the cryptocurrency’s price during that timeframe.
Unlike the aggressive accumulation strategies seen in previous years, Nakamoto paused its Bitcoin buying in the first quarter. Instead, the company was forced to sell 284 Bitcoin in late March just to cover its operational expenses. Even after the sell-off, Nakamoto still holds 5,058 Bitcoin, making it the 20th largest corporate Bitcoin treasury globally, sitting just behind ProCap Financial and far below industry giants like Strategy, which holds over 843,000 Bitcoin.
This rough patch is part of a larger trend impacting the entire crypto treasury sector, which has been caught in a severe downturn since 2025. Today, many of these companies are seeing their stock prices sink lower than the actual value of the digital assets on their balance sheets. As firms like the Genius Group resort to liquidating their entire Bitcoin stashes to pay off debt, industry experts predict we will soon see a major wave of mergers and consolidations as these companies fight to stay afloat.
