Forces Nakamoto reverse stock split decision as Nasdaq pressure shakes Bitcoin treasury company in United States markets

A struggling Bitcoin-focused treasury company is making a major structural move to keep its place on the Nasdaq.

Nakamoto has confirmed it will proceed with a 1-for-40 reverse stock split this Friday, a decision aimed at lifting its share price back above the minimum listing requirement.

The move comes after weeks of pressure from regulators and a long slide in the company’s market performance, reflecting broader weakness across the crypto treasury sector.

Nasdaq Warning Forces Company Into Action

Back in December, Nasdaq issued a formal notice to Nakamoto after its stock stayed below $1 for 30 straight trading days.

That threshold matters because listed companies must maintain a minimum bid price to remain compliant.

According to an SEC filing, Nakamoto now has until June 8 to correct the issue and sustain a share price above $1 for at least 10 consecutive business days.

Failure to meet that condition could trigger delisting proceedings.

For management, the reverse split is a quick technical fix rather than a fundamental business turnaround—but one often used when share prices collapse.

What a 1-for-40 Reverse Stock Split Actually Does

The company’s approved structure will combine every 40 existing shares into one new share.

That means shareholders won’t lose proportional ownership, but they will hold fewer shares at a higher nominal price.

Before the split, Nakamoto had about 696.1 million shares outstanding.

After Friday’s adjustment, that number will fall sharply to roughly 17.4 million.

The company has said the goal is straightforward: push the share price back above the $1 mark so it can remain listed on the Nasdaq Global Market.

A Company Under Heavy Financial Pressure

The split doesn’t erase Nakamoto’s deeper financial problems.

In its first-quarter results released May 14, the company reported a $238.8 million net loss despite a strong jump in revenue—up around 500% quarter-over-quarter.

A major driver of that loss was a $102 million mark-to-market hit tied to its Bitcoin holdings, which were impacted by a 23% drop in BTC prices during the quarter.

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Nakamoto held 5,058 Bitcoin at the time.

Interestingly, the company also sold 284 Bitcoin on March 31 to help cover operating costs, signaling that its treasury strategy has shifted from accumulation to liquidity management.

Crypto Treasury Model Faces Growing Strain

Nakamoto is not alone in its struggles. Across the sector, Bitcoin treasury companies have faced shrinking valuations since 2025.

In many cases, stock prices have dropped below the actual value of the crypto held on company balance sheets.

Market analysts, including Standard Chartered, have pointed to this disconnect as a sign of weakening investor confidence in the model.

Some firms have even started selling Bitcoin holdings or using them to repay debt.

Industry voices like BTCS strategy chief Wojciech Kaszycki have suggested that consolidation may become more common as weaker treasury firms struggle to survive independently.

From Market Darling to Extreme Decline

Nakamoto’s stock, trading under the ticker NAKA, reflects that broader downturn.

It recently closed at just 16 cents, down 7.5% in a single session.

Even more striking, it has lost more than 99% of its value since peaking above $25 in May last year, shortly after announcing its Bitcoin treasury strategy and merger with KindlyMD.

Despite being the 20th-largest Bitcoin treasury holder globally, according to BitcoinTreasuries.

Net, its position has done little to stabilize investor sentiment.

For comparison, Strategy—led by Michael Saylor—remains the dominant player in the space with more than 843,000 BTC on its balance sheet.

Impact and Consequences

The reverse stock split may temporarily resolve Nakamoto’s Nasdaq compliance issue, but it doesn’t fix underlying profitability or balance sheet volatility.

In many cases, such moves can improve optics without restoring investor confidence.

The broader consequence is reputational pressure across crypto treasury firms, which are increasingly being judged not just on Bitcoin exposure but on operational sustainability.

If sentiment continues to weaken, more firms may be forced into restructuring, asset sales, or mergers.

For shareholders, the immediate impact is a reduced share count and potentially higher per-share price, but the long-term risk remains tied to Bitcoin volatility and company cash flow.

What’s Next?

Nakamoto must now ensure its post-split share price stays above $1 for at least 10 consecutive trading days to regain full compliance with Nasdaq rules.

That short-term window will be closely watched by traders and analysts.

Beyond compliance, attention will turn to whether the company adjusts its Bitcoin strategy further—either rebuilding its treasury position or continuing to liquidate assets to fund operations.

The broader crypto treasury sector is also expected to see more consolidation talk in 2026, especially if Bitcoin price swings continue to pressure balance sheets.

Summary

Nakamoto is implementing a 1-for-40 reverse stock split to avoid Nasdaq delisting after its share price fell far below $1.

The company is also dealing with heavy losses, Bitcoin-related markdowns, and declining investor confidence.

While the move may secure short-term listing compliance, its long-term outlook remains tied to volatile crypto markets and ongoing financial strain.

Bulleted Takeaways

• Nakamoto is executing a 1-for-40 reverse stock split on Friday
• The move aims to restore Nasdaq compliance after the stock fell below $1
• Shares will drop from 696.1 million to about 17.4 million
• The company reported a $238.8 million Q1 net loss
• Losses included a $102 million Bitcoin mark-to-market impact
• Nakamoto sold 284 BTC to cover operating expenses
• Stock (NAKA) is down over 99% from its $25+ peak last year
• Crypto treasury firms are broadly struggling amid market downturns
• Post-split compliance requires maintaining $1+ share price for 10 days
• Long-term stability depends on Bitcoin volatility and operational recovery