Bitcoin Treasuries: An Explosion Waiting to Happen, Warns Capriole Founder
Corporate Bitcoin treasuries are a powder keg—and the fuse is lit.
The Institutional Tinderbox
Forget the retail frenzy. The real story unfolds in corporate boardrooms and sovereign wealth funds. Massive Bitcoin holdings, accumulated quietly over recent years, now sit on balance sheets like dormant volcanoes. The trigger? Any major catalyst—regulatory clarity, a macro shock, or simple FOMO from latecomers.
Pressure Builds, Liquidity Vanishes
When these institutional vaults decide to move, they don't dabble. They deploy capital at a scale that can swallow available market liquidity in a heartbeat. The resulting price surge wouldn't be a rally—it would be a structural repricing of the asset itself. A classic case of too much money chasing too few coins, a problem Wall Street creates and then pretends to solve with complex derivatives.
The Countdown Clock
This isn't speculation; it's supply-chain economics. With millions of coins effectively locked in long-term treasury strategies, the freely traded float shrinks by the day. The market's thin order books are no match for the pent-up demand waiting in the wings. The warning is clear: the foundation for the next parabolic move is already poured and curing. All it needs is a spark.
Bitcoin Treasury Company Count Has Climbed To 200
In a new post on X, Capriole Investments founder Charles Edwards has talked about the situation of the Bitcoin Digital Asset Treasury (DAT) firms, companies that have added BTC to their balance sheet. The DAT model was popularized by Michael Saylor’s Strategy (formerly MicroStrategy), who has been a relentless buyer of Bitcoin in recent years.
2025 particularly saw DAT strategies gain traction, with companies not only looking at Bitcoin as a treasury asset, but also other coins like ethereum and Solana. Following this boom, BTC treasury companies now number in the hundreds.
Edwards has given a warning about these firms, however, saying, “The DAT model is a leverage explosion waiting to happen.” The analyst has compared the growth in DATs to the trajectory followed by investment trusts in the 1920s, noting that the only difference between the two is that trusts bought stocks, while DATs are buying Bitcoin.
“There is no sustainable business model for generating yield on a fixed supply asset, which incentivizes leverage when mNAVs collapse,” explained Edwards. The stock buying boom in 1920s from the investment trusts helped fuel a market bubble that ultimately burst toward the end of that decade. Below is a chart shared by the analyst that compares the trajectories followed by investment trusts and Bitcoin DATs.
From the graph, it’s visible that investment trusts initially followed gradual growth, but then in the 1920s, their growth gained acceleration. Something similar has happened with DATs, just on a much smaller timeframe.
At the end of 1929, there were around 600 investment trusts, while today, Bitcoin DATs number at about 200. Thus, BTC DATs are still behind in count. “How big can the DAT bubble grow? That’s the million dollar question,” said the Capriole founder, noting that the trust bubble went on for nearly a decade.
The cryptocurrency market has been facing a downturn recently, and, since the treasury boom occurred in 2025 and companies bought at bull run prices, DATs have come under pressure. Even Strategy with its history of buying at varied prices has seen its massive 713,502 BTC holdings dip into the red.
“Today Bitcoin treasuries hold 12% of all Bitcoin, the unwind will make Luna & FTX look like child’s play,” said Edwards. Both the events referenced by the analyst were major crashes from the 2022 bear market. The former was triggered by the depegging of the stablecoin TerraUSD (UST), while the latter occurred as cryptocurrency exchange FTX collapsed.
BTC Price
At the time of writing, Bitcoin is floating around $74,500, down 16% in the last seven days.
