Strive's stock price plummeted 12% after acquiring Semler Scientific — Bitcoin reserves increased to 12,798 coins, setting a record

Strive Inc. (Stock Code: ASST) shareholder approval has been obtained for the acquisition of Semler Scientific (Stock Code: SMLR). This all-stock transaction was originally expected to be positive news. However, market reactions were unexpected—the stocks of both companies plummeted following the announcement of the transaction and the simultaneous 1:20 reverse stock split, with Strive’s stock falling 12% and Semler’s nearly 10%. This contradictory market performance highlights the complex challenges faced by crypto asset companies.

Surge in Bitcoin Reserves

The significance of this merger lies in its impact on Bitcoin holdings. According to the agreement, Semler’s 5,048 Bitcoins will be integrated into Strive’s balance sheet. After the merger, the newly formed unified company will hold nearly 12,798 Bitcoins, ranking it 11th among global corporate Bitcoin holders, surpassing Tesla and Trump Media & Technology Group’s Bitcoin reserves.

Notably, Strive recently purchased 123 Bitcoins at an average price of $91,561 each, totaling $11.3 million. This reflects the company’s ongoing strategy to expand its digital asset holdings.

Market Confusion Over Reverse Stock Split

While the scale of the merger and the growth in Bitcoin reserves are impressive, the real reason for the stock price decline lies in the market’s reaction to the reverse split. Strive announced a reverse split plan simultaneously with the transaction, which caught investors off guard.

Ben Verkman, Strive’s Investment Director, explained that the purpose of the reverse split was “to align the stock price with institutional participant standards.” In the three months prior to the announcement, Strive’s stock traded below $1. The company’s CEO, Matt Cole, defended the move, acknowledging that from a valuation perspective, it “doesn’t make sense logically,” but he pointed out that it “opens the door for multiple potential institutional participants.”

Nevertheless, the initial market response to the announcement was negative. The stock briefly dropped to $0.90 and then stabilized at a level 12% below pre-announcement levels.

Debt Restructuring and Strategic Shift

In addition to expanding Bitcoin holdings, Strive has assumed approximately $120 million in debt related to Semler. This debt includes a $100 million convertible bond and a $20 million loan from Coinbase. Management stated they plan to generate cash flow through Semler’s medical diagnostics business to gradually repay this debt.

Corporate Consolidation Under Market Pressure

This acquisition reflects broader market difficulties faced by crypto asset companies. Many digital asset firms currently trade at prices far below their net asset value of crypto holdings, severely limiting their ability to raise capital to expand Bitcoin reserves. In this context, mergers and asset consolidation have become some of the few tools capable of helping companies scale and increase market visibility.

The company has indicated it will maintain a lean corporate structure focused on Bitcoin operations and revenue generation. This suggests that Strive’s core strategy is to generate cash flow through its medical diagnostics business while holding and accumulating Bitcoin as a long-term store of value.

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