Summary:
Bitcoin’s pullback into the mid-$75,000s has pushed Michael Saylor’s Strategy marginally below its average bitcoin cost base.
While the firm is technically “underwater” on paper, analysts see no balance-sheet stress or forced-selling risk.
Strategy’s bitcoin holdings are unencumbered, and its debt structure allows significant flexibility.
The main impact of lower bitcoin prices is on future fundraising capacity, not solvency.
History suggests slower accumulation during periods when Strategy trades below the value of its bitcoin holdings.
Info via CoinBase.
Bitcoin’s recent slide to around $75,200 has pushed Strategy below the average price it paid for its vast bitcoin holdings, putting the company’s flagship digital asset position marginally underwater for the first time in months. The move has attracted attention given the scale of Strategy’s exposure, but analysts argue it does little to change the underlying financial reality of the firm.
Strategy, led by executive chairman Michael Saylor, holds approximately 712,647 bitcoin, acquired at an average cost of about $76,000 per coin. The latest dip means the market value of those holdings has slipped slightly below the purchase price. However, observers note that the headline optics overstate the risk. The company’s bitcoin is fully unencumbered, with none pledged as collateral, eliminating the threat of forced liquidation tied to price declines.
Concerns have also resurfaced around Strategy’s $8.2 billion in convertible debt, but analysts point out that the structure of those obligations provides ample breathing room. The first meaningful put date on the convertibles does not arrive until the second half of 2027, giving the company years to manage maturities. Strategy also retains the option to roll over debt, convert it into equity, or deploy alternative capital tools if needed—approaches that have already been used by other bitcoin-focused treasury firms.
Liquidity further cushions the balance sheet. Strategy is holding more than $2 billion in cash, earmarked primarily for dividend payments, reinforcing the view that near-term financial stress is not an issue even with bitcoin trading below cost.
Where the price pullback does matter is in capital raising. Strategy has historically expanded its bitcoin position by issuing shares through at-the-market equity programmes. This approach works best when the stock trades at a premium to the market value of its bitcoin holdings. With bitcoin falling sharply from recent highs and Strategy’s market valuation compressing, that premium has narrowed or flipped into a discount, making new equity issuance less attractive.
As a result, analysts expect the company’s pace of bitcoin accumulation to slow rather than reverse. A similar dynamic played out in 2022, when Strategy added relatively little to its holdings during an extended period of weaker prices.
In short, trading slightly below cost is not a crisis. It signals a pause in aggressive accumulation rather than financial distress, leaving Strategy positioned to wait for more favourable market conditions.
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