How Strategy used half its stock price to buy 225,000 Bitcoin in 2025

In 2025, Strategy (formerly MicroStrategy) executed a capital markets feat that successfully cornered the availability of recent Bitcoin, buying extra cash than the worldwide mining community produced for your entire 12 months.

Throughout the 12 months, Strategy added roughly 225,027 BTC to its company treasury, bringing its whole holdings to roughly 672,497 BTC. This buying marketing campaign exceeded the estimated post-halving issuance of 164,000 cash, making a mathematical provide shock.

Yet, the corporate enters 2026 dealing with a stark market actuality: its stock price has halved, decoupling violently from the very asset it hoards.

Data from Strategy reveals its shares plummeted 52% over the ultimate three months of the 12 months, ending with a market capitalization of $48.3 billion. This is considerably lower than the $59.2 billion market worth of its bitcoin holdings.

This divergence shouldn’t be merely a shift in sentiment; it represents the unwinding of a selected structural commerce and a ruthless re-evaluation of the corporate’s leveraged capital construction.

As 2026 begins, the narrative has shifted from Strategy as a premium-priced proxy to a posh battleground the place brief sellers, arbitrageurs, and debt obligations weigh heavier than the “super-cycle” thesis.

The arbitrage unwind and brief curiosity

For a lot of the earlier cycle, Strategy traded at a major premium to the web asset worth (NAV) of its holdings.

This premium existed as a result of traders handled the stock as a leveraged volatility instrument. Hedge funds and proprietary buying and selling desks monetized this by placing on the “MSTR arbitrage” commerce: shopping for the stock and shorting bitcoin futures to harvest the volatility premium.

However, that dynamic inverted in 2025 as the corporate flooded the market with fairness to fund its 225,000-coin haul, ensuing in the collapse of the premium.

Consequently, refined market contributors started unwinding the premium commerce or getting into a brand new construction: going lengthy spot bitcoin through ETFs and shorting Strategy stock to seize the narrowing unfold.

Market knowledge confirms the depth of this battle. As of Dec. 15, Strategy carried a brief curiosity of 29.14 million shares, representing 11.08% of its public float, in accordance to Marketbeat data.

While this marks a 4.62% lower from November, Strategy stays some of the shorted shares in the market.

The persistent brief curiosity signifies {that a} significant cohort of the market is betting against the company’s capability to keep its valuation premium amidst heavy dilution.

This structural strain explains why the stock failed to rally whilst Bitcoin held near $87,983 despite the significant headwinds its faced.

The market moved from viewing Strategy as a shortage play to viewing it as a mechanism for dilution. An implied volatility of 71% additional underscores the anxiousness, pricing the fairness not as a steady holding firm however as a high-octane spinoff.

The debt actuality vs. the ‘low cost’

A crucial error in easy retail evaluation has been evaluating the market cap instantly to the Bitcoin stack and labeling the distinction a “low cost.”

As of press time, the agency’s Bitcoin reserve was valued at $59.2 billion, whereas the market capitalization stood at simply $48.3 billion. To the informal observer, the stock appeared to be buying and selling at an almost $11 billion low cost to its gross belongings.

However, institutional evaluation takes a tougher line, specializing in Enterprise Value (EV) to account for the corporate’s large debt load. When adjusted for the billions in convertible notes used to fund this accumulation, the image adjustments.

The firm’s Enterprise Value stood at $62.3 billion at year-end, which is roughly $3 billion larger than the worth of the BTC stack.

This unfold reveals that when debt obligations are factored in, the “free cash” low cost evaporates.

Essentially, the market is pricing the corporate at a razor-thin a number of of its adjusted internet belongings—mirrored in its mNAV (market to Net Asset Value) of 1.05.

The market’s refusal to award the next premium suggests traders are not pricing the stock primarily based on the gross worth of the cash ($59.2 billion), however are as a substitute keenly conscious that the debt ($14 billion implied distinction between Market Cap and EV) has a senior declare on these belongings.

The dilution engine vs. ‘BTC Yield’

The engine of Strategy’s accumulation, which has been selling stock to buy Bitcoin, confronted a crucial stress take a look at in the fourth quarter.

The firm depends on at-the-market (ATM) fairness issuance to fund its purchases. In 2025, this “rinse-and-repeat” loop scaled the treasury to nation-state ranges, however it additionally launched a reflexivity entice.

Management promotes a Key Performance Indicator (KPI) often called “BTC Yield,” which measures the share improve in BTC holdings per share. The thesis is that so long as the corporate can difficulty shares at a premium to the price of buying bitcoin, the accretion advantages shareholders.

However, the market’s focus shifted in late 2025 from “yield” to uncooked dilution. With the stock price down 53% during the last 12 months, Strategy should difficulty extra shares to increase the identical quantity of capital.

This will increase the denominator (the share rely) sooner than the numerator (the Bitcoin stack) grows.

Despite this, the corporate has proven no indicators of pivoting. Strategy has raised a cash reserve exceeding $2 billion, and administration has poured chilly water on any suggestion of promoting bitcoin to service debt or buy again shares.

So, the commitment to the accumulation strategy is absolute, even because the fairness market exacts a heavy toll.

The 12 months forward

Considering the above, the outlook for 2026 depends much less on broad sentiment and extra on the precise sensitivity of Strategy’s steadiness sheet to Bitcoin’s price action.

The earlier “up solely” correlation has damaged, changed by a posh interplay of leverage, issuance cadence, and index flows.

In a state of affairs the place Bitcoin pushes towards $110,000, the asset hole, the distinction between the coin stack and the debt-adjusted fairness worth, would widen considerably.

Historically, spreads of that magnitude pressure a repricing, as brief sellers are squeezed out and worth traders step in. Under these circumstances, the premium might return, offered administration slows the tempo of issuance.

However, if Bitcoin stays in the present $80,000 to $90,000 consolidation zone, the mechanics of the ATM providing face a problem.

Continued issuance in a flat market erodes the BTC per share, validating the skeptics who view the stock as a “noisy tracker fund” with high charges in the type of dilution.

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