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mNAV speculation in public markets is back. Coined as a colloquial oversimplification in crypto lingo, mNAV means multiple-to-net asset value or the ratio of market capitalization to the crypto assets held by a public company.
However, as with most parlance from the nascent crypto sector, the acronym is a misnomer. Unlike trusts, public companies do not have “net assets,” a controlled term, nor is there any right of common shareholders to redeem shares for any assets.
Even MicroStrategy, the largest company trading at a positive mNAV, explicitly tells its shareholders that its stock (MSTR) doesn’t confer any ownership interest in the bitcoin ($BTC) the company holds.
Nevertheless, as of publication time, there are at least half a dozen public companies on US stock exchanges trading at a positive mNAV.
Investing exuberance for MicroStrategy peaked on November 20, 2024, when investors paid more than a 3.4 mNAV. Nowadays, its mNAV ratio has declined to 2.
Still quite impressive, an mNAV of 2 means that investors are paying double as much for MSTR as they could otherwise pay to simply acquire $BTC outright. MSTR investors overpay because they believe Michael Saylor will find ways to expand that multiple or accrete $BTC on a fully diluted basis into the future.
Other companies are trading at far more generous multiples.
Read more: Strategy trades at nine-month low multiple to its bitcoin holdings
Overpaying for crypto: Beyond MicroStrategy
Cantor Equity Partners (CEP), Jack Mallers’ newly-formed company controlled by Tether and Bitfinex, closed Wednesday’s trading session with a market cap of $433 million on the aspiration of obtaining 2.7% of 42,000 $BTC, worth about $107 million.
That places CEP’s mNAV at an impressive 4.
Upexi (UPXI) recently closed a $100 million private placement that it intends to use to purchase solana ($SOL).
Under the assumption that it will acquire $100 million worth of $SOL in short order, it closed Wednesday’s trading session at a $407 million market cap or mNAV of 4.
$SOL Strategies (CYFRF) secured a $500 million convertible note facility to acquire $SOL.
It has only tapped some of that facility, however, and last disclosed 267,151 $SOL on its balance sheet that would be worth about $40 million today if that token count hasn’t increased.
That imputes an mNAV of 8.2 at its closing market cap of $330 million.
Elsewhere, DeFi Development Corporation (JNVR) raised $42 million to buy $SOL. It closed at a $109 million market cap for an mNAV of 2.6.
Meanwhile, Metaplanet (MTPLF) holds 5,000 $BTC worth $474 million yet closed for trading Wednesday at a $1.3 billion market cap, placing its mNAV at 2.7.
Finally, the $392 million Boyaa Interactive (BOYAF) holds $317 million worth of $BTC, meaning its mNAV is 1.2.
As the examples above illustrate, mNAV is a simplistic valuation that ignores debt, business obligations, and a host of other factors that should influence a reasonable investment decision.
Nevertheless, with so many ratios above 1, it’s clear that a round of mNAV mania is once again infecting crypto traders.