Strive and Semler: when investor enthusiasm meets the reality of reverse splits

The acquisition agreement of Semler Scientific by Strive should have been good news for the crypto treasury. The merger of the two companies will create one of the largest corporate Bitcoin holders in the world. However, this project turned out to be a kind of test for investor will and patience. The enthusiasm usually accompanying such strategic moves proved insufficient to offset the shock from the management’s unexpected decision.

Large-scale deal and internal transformations

Strive (ASST) shareholders officially approved the acquisition of Semler Scientific (SMLR), adding 5,048 bitcoins to the company’s portfolio. After the merger is completed, the combined entity will hold nearly 12,798 BTC — an amount that surpasses Tesla’s reserves and Trump Media & Technology Group. By this metric, the company will rank 11th among corporate cryptocurrency owners worldwide.

The operation included Strive’s last independent purchase — 123 BTC at a price of $11.3 million (average price $91,561 per coin). These figures highlight the ambitious nature of the asset consolidation project.

When a split becomes an unpleasant surprise

Along with the announcement of the deal approval, the company disclosed a unilateral decision to reverse the stock split in a 1-for-20 ratio. This move caused a significant drop in the quotes of both securities. Strive’s shares fell to $0.90 and continued to decline by 12%, while Semler’s shares closed 10% lower than previous levels.

Matt Cole, CEO and Chairman of the company, defended this decision as one that “does not affect the company’s valuation,” while opening the door for institutional investors. Ben Verkman, Strive’s Chief Investment Officer, noted that the split aims to align the stock price with standards accepted among major financial players.

Despite management’s logic, shareholders’ assessment proved harsher. Prolonged trading below one dollar at the end of previous quarters already undermined trust in the stock, and the sudden split maneuver was seen as a sign of despair.

Pressure of consolidation in the digital assets sector

The merger of Strive and Semler is not just a corporate deal but a symptom of a systemic problem faced by digital asset treasury companies. Investor enthusiasm in this segment has sharply declined alongside the fall in cryptocurrency asset prices. Many market participants are now trading significantly below the net value of their Bitcoin reserves, limiting their ability to raise capital for expanding holdings.

Faced with such challenges, companies are forced to turn to alternative strategies. Mergers and asset integrations have become some of the few available tools for scaling operations and gaining market visibility.

Monetization and easing of the borrower’s credit pressure

Strive announced plans to capitalize on Semler Scientific’s medical diagnostic division. Additionally, the company intends to settle approximately $120 million in debt related to the target company. This includes a convertible note of $100 million and a $20 million loan from Coinbase.

At the same time, management assured that the corporate structure would be simplified with a focus on Bitcoin operations and profit generation. Such a strategy aims to allow the company to maintain focus on its core activities while gaining synergies from the acquired medical component.

Conclusion: when actions do not meet expectations

The story of Strive and Semler demonstrates the paradox of modern crypto business. Investor enthusiasm can quickly evaporate in the face of unorthodox management decisions, even if these decisions are logical from a financial perspective. The ultimate outcome of the merger will remain under close market scrutiny. The success of this project will depend not only on the total Bitcoin reserves but also on the management’s ability to restore trust and enthusiasm for the company.