Key Takeaways:
VanEck’s Matthew Sigel warns that issuing new shares to buy Bitcoin may dilute shareholder value.
At least one public Bitcoin-holding company, SMLR, is trading near net asset value (NAV).
Sigel recommends safeguards like suspending issuance below NAV, share buybacks, and executive pay reform.
Matthew Sigel, Director of Digital Asset Research at VanEck, has called on public companies holding Bitcoin (BTC) to implement stronger measures to protect shareholder interests, citing dilution risks and misaligned incentives.
According to BlockBeats, Sigel flagged that SMLR, a Bitcoin treasury-holding company, is currently trading close to its net asset value, raising concerns about continued stock issuance to fund Bitcoin purchases.
Recommended Safeguards:
Halt share issuance when the stock trades below NAV
Prioritize share repurchases over new issuance
Revise executive compensation to align with long-term shareholder value
Sigel urged corporate boards to act promptly and avoid repeating the mistakes of public mining firms, many of which over-issued shares and overpaid executives, eroding investor returns.
“Boards must ensure capital allocation decisions don’t come at the cost of existing shareholders,” Sigel warned.
