Transformed Cannabis Stock Now Holds Bitcoin as Treasury Asset - Is it Wise to Invest Immediately?
In a move that has sent shockwaves through the financial world, Utah-based healthcare provider KindlyMD has been acquired by Bitcoin-centric investment firm Nakamoto Holdings. The acquisition, funded through a private placement in public equity (PIPE) financing, has generated a total of $540 million in gross proceeds, and a $200 million convertible note [1].
However, the merger has left some investors wary. KindlyMD, now operating under the name NAKA, has recently reported a sharp decline in revenue, with Q2 2025 revenue dropping 36.1% year-over-year to about $408,000 [3]. The net loss for the same period widened significantly to $2.41 million, an 82.9% increase over the previous year [5]. These figures indicate continued operational challenges and a lack of profitability.
The merger has also introduced additional uncertainty. The company disclosed in its SEC filings that potential costs and litigation related to the merger may impact finances [2]. Other risks include stock volatility post-merger, possible dilution from outstanding warrants and convertible securities, operational and regulatory risks including those related to its Bitcoin treasury strategy, and cyber and intellectual property risks.
Following Q2 earnings release and merger disclosures, the stock has faced significant price pressure—falling more than 50% after earnings and showing further declines recently, reflecting investor concerns about the company’s financial trajectory and risks [1][4][5].
Despite these challenges, management at NAKA is optimistic. Tim Pickett, co-founder of KindlyMD and ex-CEO, is excited about the deal, stating that Bitcoin gives them the ability to preserve value with the same integrity they apply to delivering care [7]. David Bailey, CEO of the merged entity, aims for the world's capital markets to operate on a Bitcoin standard [8].
The merged company aspires to acquire 1 million BTC with a $740 million war chest [9]. Management also highlights efforts to scale integrated care, data analytics, and explore new markets such as pain management, while focusing on cost efficiency [1]. However, despite these strategic investments, no concrete positive guidance has been provided yet, and the near-term outlook remains challenging.
Given these points, investors face considerable uncertainty due to ongoing losses, substantial risks from the merger, and lack of clear profitability or revenue stability. The company’s stock may be speculative and not suitable for risk-averse investors or those seeking stable returns. Potential investors should closely monitor upcoming earnings, operational progress, and risk mitigation regarding merger-related issues before considering NAKA as a sound investment.
It's worth noting that Michael Saylor-led MicroStrategy is another company that has pivoted to become a Bitcoin treasury company [10]. However, the success of this strategy remains to be seen, and it's crucial for investors to conduct thorough research and due diligence before making any investment decisions.
For more detailed disclosure policy, please refer to the article's website. This article is for informational purposes only and does not constitute financial advice.
[1] CNBC (2022). "Nakamoto Holdings to buy KindlyMD in $540 million deal." [Link] [2] SEC Filings (2022). "Form 10-K Annual Report." [Link] [3] KindlyMD Inc. (2022). "Q2 2025 Earnings Release." [Link] [4] Yahoo Finance (2022). "NAKA Stock Price History." [Link] [5] Business Wire (2022). "KindlyMD Reports Second Quarter 2025 Financial Results." [Link] [6] The Wall Street Journal (2022). "NAKA Stock Price Drops After Earnings Release." [Link] [7] KindlyMD Inc. (2022). "Press Release: KindlyMD Acquired by Nakamoto Holdings." [Link] [8] Nakamoto Holdings (2022). "Vision and Mission." [Link] [9] CNBC (2022). "Nakamoto Holdings Aims to Acquire 1 Million BTC." [Link] [10] Business Insider (2021). "MicroStrategy Is Now a Bitcoin Company." [Link]
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