Nakamoto Inc.: The Bitcoin Cannibal
From Mania to Grave in 365 Days. The strangest buyback announcement I have ever covered.
“What we’re looking for is intelligence, energy, and integrity. And if they don’t have the last one, the first two will kill you.”
Warren Buffett, Berkshire Hathaway annual meeting, 2005
Yesterday I read an SEC filing that should not exist.
A company called Nakamoto, ticker NAKA, authorized a buyback of up to 25 million dollars. Sounds ordinary.
Now look at the numbers around it.
On the balance sheet sit 4,467 bitcoin worth about 280 million. Against that stands 165 million of debt and around 35 million of cash. Net liquid assets of roughly 150 million. The stock trades at about half of that. Market cap of roughly 77 million dollars.
It gets better. The company also owns Bitcoin Magazine, the Bitcoin Conference, and an asset management business. At this price you get all of it for free.
It gets better still. The buyback is roughly a third of the entire market cap. The CEO bought a million dollars of stock with his own cash two weeks before the announcement. He owns 18.25 percent of the company. The lender just lowered the interest rate and extended maturities into 2027. Massive discount to net assets. Free operating businesses. A buyback the size of a third of the company. Insider buying. A cooperative lender.
On paper this is the most beautiful cannibal I have seen all year. Every word of that section is true. And yet I spent a full day digging through filings before writing this, because something about this story did not smell right.
