Greg Cipolaro says the popular calculation misleads investors and ignores debt risks
A top executive at NYDIG has urged the crypto industry to abandon the widely used market-to-net asset value (mNAV) metric, arguing that it distorts company valuations and misguides investors.
“mNAV needs to be deleted”
Greg Cipolaro, NYDIG’s global head of research, issued a sharp critique on Friday, saying the industry definition of mNAV “needs to be deleted and forgotten.”
“The original definition of ‘market cap to digital asset value’ is a useful metric for nothing,” Cipolaro wrote, warning that the calculation often overlooks the broader business operations and debt structures of crypto treasury firms.
Why the metric is misleading
Investors traditionally use mNAV—also called multiple of net asset value—to compare a company’s market capitalization with its crypto holdings. If a firm holds more Bitcoin than its market cap reflects, it is seen as undervalued, and vice versa.
But Cipolaro argued this is deeply flawed. “At best, it’s misleading; at worst, it’s disingenuous,” he noted, stressing that mNAV “doesn’t give credit” to companies generating revenue outside of crypto, such as software sales or other core businesses.
Debt and dilution not accounted for
A bigger issue, Cipolaro explained, is that mNAV calculations often assume all convertible debt is equity, which can dramatically distort valuations.
“When you peel back the convertible debt part, things unravel,” he said. Convertible debt holders, he emphasized, would demand cash repayment, not shares, creating heavier liabilities than mNAV reflects.
This oversight incentivizes digital asset treasury firms to pursue strategies of “volatility harvesting,” where equity risk is maximized rather than managed.
Impact on recent deals
The remarks came just after Strive Inc. announced its acquisition of Semler Scientific, marking the first merger of two crypto treasury companies.
Under the deal, Semler shareholders will receive 21.05 shares of Strive for each Semler share, resulting in a step-up in net asset value (NAV) per share from $1.14 to $1.32. Cipolaro said the transaction benefits both firms, though the long-term stock price will depend on whether investors apply a premium or discount to NAV.
By calling for the end of mNAV, Cipolaro is pushing investors to look beyond surface-level crypto holdings and focus instead on true NAV, revenue models, and debt obligations.
“NAV is what matters in the game of increasing digital assets per share, not market cap,” he concluded.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.